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This section explains how to set up and use the Bank reconciliation sub module of General Ledger. Bank reconciliation is a powerful system integrated with all major modules in the e5 system to enable you to reconcile bank transactions quickly and efficiently.
Control settings allow you to define accounts as bank accounts and also how to process different bank accounts within the system. An automatic reconciliation feature enables many transactions to be reconciled by the system leaving you to reconcile only the exceptions manually. Use the manual reconciliation screen to resolve the remaining items.
You must set up reconciliation controls before using the bank reconciliation Module. The Bank Reconciliation controls Screen ME01 is used to set up common controls for the system. For example, you need to identify what balance classes to use when posting Adjustments or bank Statement values to the system as only the actual transactions generated or entered into the system are captured as Actual balances (AB).
| Code Table | Screen | Notes |
| GL Company | MEAB | Bank Reconciliation controls require an existing General Ledger company to exist |
| Balance Class | MAKT | Used to segregate Adjustment and Bank Statement postings from actual postings. |
| Batch Types | MAKL | Used to identify types of postings made through Bank reconciliation. |
| Bank Reconciliation Controls | ME01 | Identify the high level controls for Bank Reconciliation |
| Bank Sort Codes | MAKY | Used to identify the Banks for which reconciliation is in use. |
| Bank Codes | ME03 | Used to link a Bank Sort code to it's Nominal definition within the system and provide specific controls for that account. |
| Bank Transaction Types | ME05 | Identifies specific details about transactions for a bank Code |
At the top level, you can define through Bank Reconciliation Company Controls (ME01) the balance classes to be used by the system to post Bank Adjustments and Bank Statement details. The Bank Statement balance class will hold transaction to be reconciled against actual transactions posted to that bank account within the system. Both of these balances classes must be defined as able to hold transactions.
You can optionally provide Batch types for the different bank reconciliation postings and define how bank unmatched reversals are to appear on displays and reports.
You must also nominate how unmatched transactions are to be dated after they have been successfully match and then the match reversed. On reversal, the date can either be set to the original date of the transaction or the date on which the unmatching occurred.
You must define bank sort codes to identify your bank. See screen MAKY in common controls for more information.
The bank Code is the key to the reconciliation within the system and identifies specific controls and details relating to the bank Account to be reconciled. In particular, the Bank Code (ME03) links the Sort Code to the specific Nominal into which postings for the bank are to be made. Note that you must define the Nominal has to be defined as a Bank Account nominal in Nominal Maintenance MEBB. Setting the Bank Account flag on this screen will also force the reconciliation screen to be set ensuring all transactions posted to the nominal are subject to reconciliation.
You can nominate an e-mail address internally to receive notification through BEM of any actions required for a specific bank Account. Similarly you can specify an external e-mail address to be used to notify your bank when an adjustment is required to be made by the bank.
Tolerances and write off accounts can be specified for each Bank Code to enable you to apply tighter or more fluid matching depending on the Bank you are dealing with.
The system allows you to define specific transaction types for use within Bank Reconciliation. These types enable the definition of specific types of transactions to be identified during Bank Statement Take on and handled automatically. For example, you can specify how the reconciliation code should be populated for the transaction type.
A transaction type can be nominated for automatic journal posting. When set, this flag causes an AB balance transaction to be posted to a nominated account with the offset posted to the Bank Account code. Typically, this is used to enable Bank Charges and other similar transactions to be recorded in the accounts from the bank Statement take on.
You can perform reconciliation automatically or manually within the system. In most cases, automatic processing will be used first to match as many transactions as possible, leaving just the exceptions to be done manually. Manual processing has many features and functions to allow you to easily identify and match transactions.
A generic statement take on process has been provide for you to take on bank Statement data from your bank. In practice however, a QED is normally required to transform the Bank Statement data you received from your bank into a form in which it can be used within Bank reconciliation. A library of common Bank interfaces are being built up for the e5 product and you should contact your Account Manager in the first instance to see if an existing QED is available to meet your specific needs.
To submit the automatic reconciliation process Enter 'Submit EW5' on a command line and click OK or navigate to it using the menu options provided. See Background Processing for more information on submitting processes.
Automatic reconciliation will match on total value for each reconciliation code, for example:
| Bank | Cash Book | ||
| Ref | Value | Ref | Value |
| ABC001 | 100 | ABC001 | 80 |
| ABC002 | 300 | ABC001 | 20 |
| ABC002 | 340 | ABC002 | 600 |
| ABC003 | 120 | ABC002 | 40 |
| ABC003 | -10 | ABC003 | 100 |
In the above case, reference ABC001 and ABC002 will both reconcile as the total for each code matches on each side, ABC003 however, will not reconcile.
You can define a tolerance amount against a Bank Code which will be used by the automatic reconciliation process to determine how close a match on value must be before transactions can be reconciled. The difference is written off to a Write Off account defined for the bank Code being processed.
To submit the automatic reconciliation process Enter 'Submit EW1' on a command line and click OK or navigate to it using the menu options provided. See Background Processing for more information on submitting processes.
To submit the automatic reconciliation by Code process, enter 'Submit EW1' on a command line and click OK or navigate to it using the menu options provided. To submit the automatic reconciliation by date process, enter ‘Submit EW3’ on a command line and click OK. See Background Processing for more information on submitting processes.
To perform manual reconciliation, use the manual reconciliation screen (ME0C). You can select to reconcile a single Bank account at any one time. Two lists are provided on screen, one of Bank Statement data and the other of your Cash Book data. Transactions can be searched for on either side, sorted using column sort or simply searched manually by scrolling the two lists.
A Find feature is available which allows you to select a transaction on one side and look for a matching transaction on the other side automatically. Where a match is found, the matching transaction will be placed at the top of the screen.
You can force match transactions by selecting two transactions with disparate values. When this action is performed, the system will ask you to choose where to post the adjustment - to the Bank or Cash Book. When you choose the Bank and the external e-mail is defined for the bank code being reconciled, then an e-mail is automatically generated and sent to the contact at the bank with details of the adjustment required.
It is possible to add notes to transactions through Manual reconciliation that stay with the record for the life of the transaction. The notes can then be made available in enquiries and reconciliation to aid in matching transactions.
The system keeps a log of all matched transactions until you choose to archive the log. Each matching operation is given a match id which you can use to identify and report on any set of matched transactions.
You can choose to list transactions which have already been matched (ME0B / ME0E) and select transactions to Unmatch.
The process EW6 is used to archive matched transactions. Once archived, transactions can no longer be Unmatched. To submit the match archive process Enter 'Submit EW6' on a command line and click OK or navigate to it using the menu options provided. See Background Processing for more information on submitting processes.
A common problem in Bank reconciliation is recognising and dealing with out of date cheques. To help with this problem, the system provides you with a facility to scan for out of date cheques and automatically cancel them.
A control is provided on each Bank Code in which you define the number of days for which a cheque remains ‘live’. A new process is provided which can then be scheduled to run on a regular basis which will then scan for all cheque type transactions on the cash book and automatically report and cancel them. Cheques which are sourced from Accounts Payable can optionally be allowed to re-instate the original invoice(s) paid or to be written off.
You can perform a number of enquiries on reconciliation data using the enquiry screen MEWA. A summary of the state of any Bank Account can be presented in addition to a number of transaction lists showing details of :
A number reconciliation reports can also be requested by submitting process EW8. To submit the reconciliation reports process Enter 'Submit EW8' on a command line and click OK or navigate to it using the menu options provided. See Background Processing for more information on submitting processes.
See also
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© Advanced, Jan 2021 |
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