Reconcile outstanding items and payments

When you register a payment, you can normally reconcile the outstanding items immediately. In some situations you need to reconcile your outstanding items 'afterwards'. For instance, these would be unrecognised outstanding items or invoices paid in advance. You then have an outstanding payment and an outstanding invoice with the debtor or creditor. In that case you have to reconcile the outstanding item for a payment or advance payment against an invoice via a general journal entry 'afterwards'.

You can also reconcile in a view with outstanding items; Profit reconciles a selection of outstanding items for you automatically. Profit then generates a general journal entry. Profit has a comprehensive set of rules for automatically recognising and reconciling outstanding items. This means you don't have to make a general journal entry yourself in order to reconcile the outstanding items.

Only use this functionality if you do not write off the item automatically (via an electronic bank statement) or write it off manually using a bank journal or cash book. This functionality is particularly useful if you want to reconcile a lot of invoices and payments against each other.

For instance, if you import a lot of financial entries from another software package or if you have a webshop that takes payments via iDEAL and you have outstanding items you want to reconcile per debtor. You can also use it if a payment is made before the invoice is known (advance payment).

You can start the reconciliation process for outstanding items from all views where outstanding items can be viewed. You can reconcile outstanding items simultaneously for several invoices and payments per debtor/creditor, as well as for several debtors and creditors.

This functionality applies to debtors as well as for creditors.

Description

You can reconcile a selection of outstanding items automatically using the 'reconciliation' functionality via the views for outstanding items. Profit reconciles the selected lines according to a reconciliation algorithm. Profit then makes an 'extra' general journal entry for those lines automatically. Profit links a credit entry (payment from debtor) to a debit entry (outstanding invoice from debtor) via a general journal entry. So you no longer have to enter this general journal entry manually.

Journal entry for an invoice:

Journal entry for a receipt from a debtor:

Journal entry for general journal entry (reconciliation):

Payment differences

A payment difference can originate for an outstanding item. Profit will automatically write this off if the payment difference is allowed based on the financial administration settings. The entries that fall within the permitted 'maximum percentage difference' and the entries within the 'maximum amount difference' are included in the automatic reconciliation. The way this check works is the same as manual reconciliation. In the settings, select the journal Profit uses for journal entries for payment differences and the accounts on which Profit enters them.

Block invoice for reconciliation

You can block an invoice for reconciliation if an invoice must not be reconciled.

Preparation

• Configure reconciliation

Procedure

• Reconcile outstanding items via overview for outstanding items
• Reconcile outstanding items per debtor

Also see

• Block invoice for reconciliation
• Reconcile ledger accounts