Potential Reconciling Items Report

During internal reconciliation, you use the Receivables to General Ledger Reconciliation Report to confirm that transactional and accounting data match. However, even if the data matches, journals can still post to incorrect general ledger accounts, due to issues with your Receivables setup.

Use the Potential Reconciling Items Report to help you identify and correct these setup issues.

You typically run the Potential Reconciling Items Report:

• For new software installations, prior to running final accounting, in order to confirm the correct derivation of accounting.

• Whenever the accounting setup has been modified--such as the creation of new transaction types, receipt methods or receivables activities--prior to running final accounting.

The report suggests journal items that potentially posted to general ledger accounts with unexpected account types, thus creating reconciliation issues in general ledger. An unexpected account type refers to general ledger account types that aren't normally associated with an item general ledger category. General ledger account types used by Receivables include assets, liabilities, income, and expense.

For example, a receivable item might be expected to post to an asset account. If the item posts to a non-asset account, then it will appear on the Potential Reconciling Items Report.

Typical items that the Potential Reconciling Items Report includes are:

• Adjustment journals with offset accounts that are asset accounts, rather than income or expense.

• Revenue journals for invoices and credit memos that post to account types other than income.

• Unearned revenue journals that post to an account type other than liability.

• Unbilled journals created for deferred billing that post to an account type other than asset.

• Late charge journals that post to an account type other than income.

• Cash, confirmation, or remittance journals that post to account types other than asset.

• Short term debt journals created by factoring receipts that post to account types other than liability.

• Nonrecoverable tax that posts to an account type other than expense.

Possible causes for discrepancy include:

• Incorrect accounting setup.

• Incorrect manual updating of general ledger account distributions.

• Setup created for activities inconsistent with the intended use of Receivables.

When a potential reconciling item is an error, correct both the individual transaction and the incorrect setup to prevent future occurrences of the same error.