t3n 02.11.2022, 13:30 - 3 min reading time
Ever heard of reconciliation? The immensely important financial process is a must for every company to ensure that its accounts are kept correctly and accurately. Automation helps with this.
What exactly is reconciliation?
Reconciliation involves comparing a company's internal financial records with the monthly statements from external sources. This is often referred to as account reconciliation. The external data is provided 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.
Why is the process so important?
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 uncovered. If the actual balances do not match those in the accounts, this data has no real significance for the financial situation in your company.
Far-reaching consequences
If you are active as a retailer, 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 all times. This is the only way to ensure that follow-up processes such as the delivery of goods or, for example, the execution of a dunning stop run smoothly - one of the many reasons why reconciliation is so important for you. However, if something goes wrong and your data subsequently turns out to be incorrect, customer complaints can pile up and customer satisfaction suffers. Improper reconciliation is hugely detrimental to customer care, as it has to deal with the effects of possible negative customer inquiries that can arise from a faulty process. You can forget about increasing margins and efficiency, which should be your actual goal.
So you can see that reconciliation can have far-reaching effects on your business. Does your posted income actually match the invoice amounts? Unpaid or incompletely paid invoices are only really noticeable if the account reconciliation is carried out accurately. The full extent of this becomes apparent at the latest at the time of the annual accounts: companies are required by law to prepare correct annual accounts. Reconciling accounts is not a quick job that you should take lightly, as it is a prerequisite for a coherent year-end result.
What needs to be considered?
The manual reconciliation of accounts can sometimes be very complicated and time-consuming. To get a complete overview, each posting record and each bank transaction must be viewed and compared individually. By automating this process, you can not only save an enormous amount of time, but also ensure that the debit and credit entries in the accounts contain the correct values.
At the same time, you can also save your personnel resources at this point. A fully automated solution not only reduces the workload for you and your team, but also allows you to carry out reconciliation more often than if you were to do it manually. This means you always have a clear overview of your accounting, which also improves in quality.
Many solutions, but which one suits you?
Do you finally want to take your bookkeeping 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. Importantly, the company is always GDPR-compliant and attaches great importance to the highest level of IT security.
Support with reconciliation
Among other things, nexnet's Payment Clearing is exactly 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 - completely automatically.
Did you know? nexnet also supports you with transaction management for international transactions: Complete monitoring of all your relevant payment transactions is guaranteed - from purchase in the store to receipt of funds 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, for example.
Try it out for yourself and benefit from a customized process solution - together with nexnet.
