Bank Reconciliation: Methods, tools and advice for carrying it out

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Le 14/02/2025, par :
- Tony Benedetti
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Here are the answers to all the questions for managing bank reconciliation.
What is bank reconciliation ?
The definition of bank reconciliation? What is it?
Bank reconciliation is an accounting process that consists of verifying that all transactions recorded on the bank statement (Account 512) have been correctly recorded.
This is essential to compare the status of your company’s accounts. Bank reconciliation is a highly recommended check to verify the concordance between bank statements and accounting transactions.
Why is it necessary to set up a bank reconciliation ?
Financial regulations have long required companies to implement precise control processes over transactions and accounts.
Therefore, it is preferable to perform bank reconciliation at least once a month in order to quickly detect fraud and errors of all kinds. For example: Input errors or unrecorded transactions, etc.
It therefore allows you to justify the difference in balance between your bank statement and your accounting balance in order to carry out the necessary actions and adjustments. You thus have a more precise vision of your cash flow situation.
What is the process for performing a bank reconciliation ?
Setting up a bank reconciliation is divided into three steps that we will detail below:
Step 1: Checking the balances consists of verifying that the balance of your company’s accounting and the balance of the bank statement balance each other on the desired reconciliation date.
Step 2: This involves “pointing” the banking transactions with the accounting transactions that match. The relationship of the transactions can be varied (1-1 / 1-N / N-1 / N-N). Accounting transactions can also be reconciled with each other, such as banking transactions.
Step 3: The unreconciled banking and accounting transactions must be analyzed in order to take the actions that will allow their future reconciliation. The bank reconciliation statement is then successfully completed.
How to do a bank reconciliation quickly and easily ?
CALIXYS has been supporting many clients from different sectors for several years. It is about offering them bank reconciliation automation solutions.
Below we will detail the three methods commonly used by most companies:
Method 1 - Bank Reconciliation with Excel
How does it work ?
The first choice of some companies is EXCEL tables, a well-known tool for performing bank reconciliations.
EXCEL tables are available in different versions that can be downloaded from the web. However, you must remain vigilant against the possibility of viruses. In most cases, a pre-established model is not suitable for your business.
However, you can create your own model from A to Z. You will therefore need to have the time and skills necessary to develop a calculation model whose result will be reliable.
Reconciliation in EXCEL consists of entering the bank and accounting balance on the desired reconciliation date, then after having marked the transactions between your bank statement and your 512 account, you will need to enter all the transactions in differences.
Your reconciliation will be said to be “balanced” when the bank balance and the accounting balance as well as all the transactions in differences will be zero.
Why should you be wary of traditional approaches with EXCEL ?
Bank reconciliation with EXCEL seems at first glance to be straightforward. However, the parameters to be taken into account will change radically if the number of transactions between several banks or accounts to be compared becomes too large.
Traditional EXCEL approaches will mainly focus on tasks with low added value for employees. Using this approach presents a significant and unsecured operational risk.
Indeed, bank reconciliation management may then appear too complex and inefficient.
Méthode 2 - le Rapprochement Bancaire avec un Expert-comptable
Another common method is to delegate these manual tasks to an accountant or an accounting firm.
This allows your team to save a significant amount of time and makes the result of your bank reconciliation more accurate and reliable.
However, this solution also has its drawbacks. We will mention in particular the cost of the accounting firm service which remains very high.
In addition, the lack of real-time monitoring can be problematic, reducing your control and flexibility on the project.
Method 3 - Bank Reconciliation with dedicated software
How does it work ?
As a general rule, you will simply need to import the accounting data and account statements into the dedicated solution, at your own pace.
Then, automatically define and schedule your lettering rules according to your criteria. You will then obtain a reliable overview of your accounts in a minimum of time.
Why should you perform your bank reconciliation with dedicated software ?
Laurent Dufour – Founder of the Blog du Dirigeant explained how a bank reconciliation tool brings us essential advantages:
1. A substantial time saving
2. A clear, precise and up-to-date view of available cash
3. Facilitating the work of the accountant
This is why we advise you to carry out your bank reconciliation with dedicated software.
The automated bank reconciliation solution will indeed considerably simplify your daily processing and will allow you to obtain greater visibility on all of your accounts.
The XREC solution offered by the CALIXYS platform allows you to quickly identify and classify discrepancies thanks to an exception management module. The production of your bank reconciliation statements is done automatically by choosing a date.
Finally, a significant advantage of this solution is the reliable and continuous control of your accounts at all times.
In addition, you guarantee the traceability of your flows for a quality audit. You increase your ROI by freeing up time for your teams while reducing operational risks.
> Want to know more about the bank reconciliation software comparator published by Laurent Dufour? Simply click here to access the article on his blog!
What questions should you ask yourself before investing in a bank reconciliation solution ?
Once you have identified the need to automate and industrialize your reconciliations, you will have to ask yourself some serious questions before deciding to invest in a dedicated solution.
Olivier Van de Flaes – the founder of CALIXYS shares with you the 5 good questions to ask yourself before investing in a bank reconciliation solution:
Question 1: What data do I need to reconcile? How is the data structured?
Question 2: What is the nature of my reconciliation? What is its cycle? What is the business process that has been defined?
Question 3: What is the expected level of security? Is the long-term conservation of flows a criterion?
Question 4: What is the required level of automation? What is the desired interface capacity with your IS?
Question 5: Are there other reconciliation cases to consider in the future? Do I want to centralize my reconciliations ?
Simplify your bank reconciliation management with the XREC solution from the CALIXYS platform
The XREC solution of the CALIXYS platform centralizes and automates the processes of reconciling financial and accounting data. As a result, you can accelerate your financial closing process.
Thus, on the one hand, you free your teams from low value-added tasks, and on the other hand, you reduce your risks by controlling the entire process, while having increased visibility on it.