Best Practices for Account Reconciliation

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Account reconciliation is an underappreciated yet critical control to help ensure an organization's financial integrity. Weaknesses and inefficiencies in the reconciliation process often lead to mistakes on the balance sheet and overall inaccuracies in the financial close. 

Since the enactment of Sarbanes Oxley (SOX) in 2002 and other rules and regulations that have followed, ensuring the accuracy of account reconciliations has become increasingly important. In the past, if an external auditor found a material error during review of a company's financial statements, it could still be corrected by the company with an adjusting entry. In most cases, the controller wouldn't have to issue a restatement, nor would the auditor have to report the error. 

With the advent of SOX, the call for compliance has risen to another level. If the auditor finds a material error, the company may be required to disclose a failure of controls. And, if the auditor finds a misstatement while reviewing the quarterly or annual SEC reports that the company cannot prove it would have found on its own, then the error is determined to be a material misstatement and a material weakness that could also require disclosure. 

An efficient, accurate, and timely financial close cycle (beginning with the account reconciliation process) can create a foundation for evaluating business performance, supporting organizational decisions, and satisfying external reporting requirements. Automation of the account

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By Reconciliationaccounting
Jun 26th 2015 01:11

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By Steve
Jun 26th 2015 01:12

I am struggling to compile a Debtor's Reconcilliation

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Jul 11th 2017 12:44

Reconciliation is an accounting process that uses two sets of records to ensure figures are accurate and in agreement. Reconciliation is the key process used to determine whether the money leaving an account matches the amount spent, ensuring the two values are balanced at the end of the recording period. QuickBooks Support

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By Danrod
Oct 19th 2017 14:53

Yes, automation of the account is a real help not only for audit and controllers but for the whole business too. It’s a good help to escape any fraud. The payment process is simplified by consolidating multiple payment types into a single electronic file. It’s just the best solution for growing and middle market companies. Especially, it could be highly evaluated by accountants, which are used to struggle to get approvals and looking for going paperless. Switching to accounts payable and payment automation software allows you to have a more efficient business.

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