Automating the account reconciliation and financial close processes activities that used to be limited to treasury departments and typically focused on cash accounts. However, when Sarbanes-Oxley (SOX) and other corporate governance standards entered the picture, the automation of cash account reconciliation is no longer sufficient for many organizations. Companies need to implement a process that can reconcile the entire balance sheet.

This is often a big challenge for organizations, particularly due to the differing nature of the various balance sheet accounts. What works for cash may not work for fixed assets, and what works for fixed assets may not work for prepaid accounts. The best approach to take is to find a solution that meets regulatory requirements and leverages existing processing … without reinventing the wheel. This path has been traveled by plenty of organizations, so there are well defined guidelines and solutions out there for the taking.

Whether considering a new solution for automating your account reconciliation process or examining the existing solution for potential upgrade, there are several factors that need to be considered. The following are just a few of these factors, and we’ll discuss other factors in the coming weeks:

Does the solution only match data?

When an organization takes on the task of building a reconciliation solution, the first take is often a simplified one since “reconciliation” means the same as “matching.” Many in-house solutions are just matching engines—the actual reconciliation between the GL and bank balance is still performed manually, often within a spreadsheet. An automated reconciliation solution needs to do both. It needs to match data, and it needs to produce the reconciliation. This issue is not limited to in-house solutions, though. Many vendor solutions on the market only match data or only produce the reconciliation. Therefore, any solution implemented within an organization must both match and reconcile within a single application.

Does the solution provide exception management?

Anyone familiar with reconciliation understands that the real work involves researching the transactions that did not match. Reporting on exception items is a start, but the best systems provide automated exception management. Automated alerts, escalation procedures, and creation of journal entries are just a few of the features a good automated reconciliation system will include. This is a more critical requirement for cash accounts, but is still an important consideration for certain types of non-cash accounts.

T-Recs^® Enterprise from Chesapeake Systems Solutions

T-Recs^® Enterprise is an automated financial reconciliation solution. But more than that, T-Recs helps businesses identify business risks, measure ongoing performance, and assess the effectiveness of internal controls, including workflows and audit trails.

Simply put, T-Recs Enterprise offers a complete control framework for reconciling a general ledger and managing core accounting processes.

Benefits of T-Recs^® Enterprise

Automating business processes using T-Recs Enterprise increases productivity, improves risk management, and reduces costs!