5 Best Reconciliation Tools: Complete Guide
Bank account reconciliation software centralises the financial close process and automates it for businesses. The software pulls data from the general ledger and compares it to bank statements and invoices to quickly reconcile accounts. Then, the software allows the preparer to electronically sign off upon completion and send it over to the approver for a final review. Once it’s approved, the software stores the data in the centralised database and provides your business with a secure audit trail.
Most software systems allow for teams to upload supporting documents, view company policies, electronically sign off on reconciliations and leave comments, if needed. It also allows for controls to be set up so that processes are gated between employees for audit and compliance requirements. Additionally, the tool may provide users with a dashboard or a visual representation of current financial standing.
What Features Should Be Included?
When looking for reconciliation software tools, you’ll want to make sure the following features are included:
Reporting: A statement can be produced to highlight any records that are unmatched between the GL and bank statement. The system should also be able to compare financial reports from previous historical periods in time.
Issue management: If there’s an issue, the tool should identify the exception and be able to roll the forward problems into subsequent periods until it’s been resolved. You can also leverage a clean-up method to resolve issues manually.
Transaction matching: This is the crux of the tool. Here, the data can be pulled from various sources, compared and matched. You can establish matching rules for each account separately or create company-wide matching policies. You should also be able to define tolerance levels for a variance.
Classification: Records should be able to be classified and attributed to their type classes during the matching process. This could be performed manually or automatically.
Benefits of Automation Reconciliation Software
Account reconciliation software saves your team time. More than saving time, it offers many necessary businesses like providing consistency, accuracy and clarity plus it reduces compliance risk, which can ultimately save you money, prevent fraud and maintain your entire company’s reputation.
Here’s a look at some of the significant benefits of account reconciliation software.
Fully automated and fast: One of the essential benefits of reconciliation software like SolveXia is that it is fully automated. This makes it easy to complete the financial close process in no time. Many finance teams spend the majority of their time inputting data, trying to understand variances and wasting time on manual and repetitive tasks. With account reconciliation software, the process is managed automatically, freeing up your team to focus on high-level work, while improving accuracy and insights while improving controls and reducing audit risks.
Uniform approach / standardised process: The reconciliation process should happen monthly. At the very least, it will take place quarterly, so it helps to standardise the process to ensure its accuracy. With account reconciliation software, the system will run reconciliations according to the automated process the same way, every time. This is particularly useful if your reconciliations take data from different systems, and there is complex and varied mapping and data cleansing involved. Reconciliation software removes automated this process, saving time and improving accuracy.
Reduce errors & enhance internal controls: Reconciliation software allows for enhanced internal controls because leaders and stakeholders can see how the process is functioning and rest assured that it’s running smoothly every time. It also prevents any actions outside the process, while alerts can also be set-up for any unusual variances or activities. By reducing manual human inputs, and with automatic mapping, you are also able to reduce errors. The software is trained to be accurate, which will prevent many potentially costly mistakes from occurring, while alerts will help identify problems as they happen in real-time.