t3n 02.11.2022, 13:30 – 3 min. Reading time
Ever heard of reconciliation? The immensely important financial process is a must for any business to ensure that the accounts are kept correctly and accurately. Automation helps with this.
What exactly is meant by reconciliation?
Reconciliation involves comparing a company’s internal financial records with monthly statements from external sources. In this context, one often speaks of account reconciliation. The external data is supplied to the accounting department both by other departments within the company and by third parties outside the company. External sources can be, for example, the bank, credit card companies or a PSP (Payment Service Provider) – but as a merchant, this can also include your customers or suppliers.
Account reconciliation is an important task in accounting, as it checks whether the balances in the books correspond to the actual balances – so that inconsistencies can be quickly detected. Because if the actual balances do not match those in the accounting, this data has no real meaning about the financial situation that prevails in your company.
If you are active as a merchant, for example, it is advisable to have a detailed overview of your funds – you must be able to allocate them to your buyers and their purchases at any time. This is the only way that subsequent processes such as the delivery of goods or, for example, the execution of a dunning stop can run smoothly – one of many reasons why reconciliation should be so important for you. However, if something goes wrong and your data subsequently turns out to be incorrect, customer complaints can accumulate and customer satisfaction suffers. A messy matching process hurts customer care tremendously, because they have to deal with the fallout from potential negative customer inquiries that can occur if the process is flawed. In this way, you can forget about increasing margins and efficiency, which should be your real goal.
So you realize that matching can have far-reaching effects on your business. Do your posted revenues actually match the invoice amounts? Unpaid or incompletely paid invoices only really stand out if the account reconciliation is performed accurately. The full extent becomes apparent at the latest at the time of the annual financial statements: According to the legislator, companies are obliged to prepare correct annual financial statements. Account reconciliation is not a quick activity for on the side that you should take lightly, because it is a prerequisite for a coherent year-end result.
Manual reconciliation of accounts can sometimes be very complicated and time-consuming. This is because in order to obtain a complete overview, each booking record and each bank transaction must be considered and compared individually. By automating this process, you can not only save an enormous amount of time, but at the same time ensure that the debits and credits in the accounting contain the correct values.
At the same time, you can also save your personnel resources at this point. A fully automated solution not only takes workload off you and your team, but also allows you to perform reconciliation more often than if you were to do it manually. So you always have a clear overview of your accounting, which at the same time gains in quality.
Many solutions, but which one suits you?
Finally want to take your accounting to the next level? Then you should take a look at nexnet. nexnet offers you a comprehensive all-round service in accounting and finance – and has been doing so for over 20 years. The important thing here is that the company is always DSGVO-compliant and attaches great importance to maximum IT security.
Among other things, you’ll find nexnet’s Payment Clearing to be just the right solution if you want to monitor your financial transactions efficiently, securely and conveniently – which is a huge help, especially for account reconciliation. You can rely on the overview of all money movements, their completeness, due date and correctness. With payment clearing, all financial transactions are reconciled with the sales data from your online store, marketplaces or offline sales channels – and this is completely automated.
Did you know? When it comes to transaction management, nexnet also supports you with international transactions: The complete monitoring of all your relevant payment transactions is guaranteed – from the purchase in the store to the receipt of money in your bank account, for every purchase transaction and for every buyer.
All business transactions can also be recorded in a mass-capable accounts receivable accounting system. If you wish, you can also combine these services with various reporting and other modular services.
Try it out for yourself and benefit from an individual process solution – together with nexnet.