About Reconciliation Compliance

Reconciliations ensure that a company's financial accounts are validated to check that the balance in the account is correct. Because account balances are valid at a point in time, and business conditions change, it is critical that reconciliations occur. In addition, companies face stiff penalties for failing to reconcile. The types of validations that are often done include:

• Cash: Compare General Ledger (GL)/Bank balance

• AP: Compare GL to Subledger

• AR: Compare GL to Subledger and analyze aging of receivables

• Fixed Assets: Compare GL to Subledger and perform a rollforward

• Prepaids / Accruals / Provisions / Reserves: Document net composition and justify quality

Reconciliation Compliance helps manage account reconciliation processes, including balance sheet reconciliations, consolidation system reconciliations, and other reconciliation processes in effect.

You can:

• Manage preparation and review responsibility assignments

• Configure reconciliation formats tailored to each account type

• Notify users of due dates for their assigned reconciliations

• Control preparation and review workflow

• Provide visibility into the reconciliation status and possible risk conditions

Reconciliations can be performed at whatever level makes sense for the business. For example, you could perform some reconciliation by business unit or company code, while performing other reconciliations at the Department level. An administrator can use mapping rules to assign the account balances to the reconciliations, and when balances are imported, ensure they appear in the correct reconciliation based on these rules.

The administrator sets up the reconciliation lists that contain the balances to be reconciled, as well as account descriptions, instructions, due dates, and completed dates. Email notifications are sent reminding other users that due dates are approaching, or that reconciliations can be acted upon.