Reconcile ledger accounts (balancing entries)

When reconciling, you cancel out amounts against each other.

Reconciliations can be done automatically and manually. You save a lot of time if you always do the reconciliation process automatically first and then reconcile the exceptions manually. Profit has a comprehensive set of rules for automatically recognising and reconciling journal entries. In this way, a matching rate of more than 75% can be achieved. During the reconciliation process, the quick filter and multiselect options are useful for selecting several journal entries in one go.

You can also reconcile entries on a blocked ledger account but you cannot post new entries to a blocked account.

Reconcile ledger account automatically

You can reconcile a ledger account automatically and then reconcile the exceptions manually.

During the automatic reconciliation, Profit automatically searches for the corresponding journal entry lines to reconcile them against one another and then suggests these. In the process, Profit first checks whether Reconciliation reference is completed. If the reconciliation reference is filled in, it gets priority in the automatic reconciliation: Profit will match entries faster if they have the same reconciliation reference.

Differences can be reconciled automatically if they fall within the permitted differences in the administration settings. You can determine what the maximum difference is for the reconciliation of ledger accounts in the administration settings. This amount is allocated to the last journal entry of the reconciliation code in question. If the balance of the journal entries with the same reconciliation reference is within the set limits for the permitted payment difference, Profit suggests that this be reconciled and the difference be written off.

Profit matches journal entries without Reconciliation reference according to the amount ranked by the entry date (oldest first).

Reconcile ledger account automatically:

1. Go to: Financial / Enter / Reconcile.
2. Select the ledger account.

   If you do not see the account, switch on reconciliation in the account properties of the ledger account.

3. Click on: Finish.

   Profit displays a view with all entries that can be reconciled. If you have specified in the account properties that the account can be reconciled against another account, you see the entries for both accounts.

4. Set a filter if you want to make a selection of journal entries you want to reconcile.
5. Select the lines you want to reconcile. You can select multiselect lines.

   Press Ctrl+S if the column with the selection boxes does not appear in the view. Press Ctrl+A if you want to select the check boxes for all lines in one go.

6. Click on the action: Reconcile automatically.

   You open the Reconciliation proposal view which shows journal entry lines that need to be reconciled. These are based on the selection you made in the previous view.

7. Deselect the check box for the journal entry lines you do not want to include in the automatic reconciliation. You then have to deselect all the journal entries with that reconciliation code. You can quickly deselect all the check boxes by using Deselect (Ctrl+D hotkey) or select them using the Ctrl+A hotkey.

   You can adjust this view.

   Small differences can be reconciled automatically if they fall within the permitted differences in the administration settings.

8. Click on: Finish.

The financial entries are updated with the reconciliation code, date and user, the same way as the manual reconciliation functionality. If there are differences, journal entries are made which are used to write off the ledger account differences.

After you have done the automatic reconciliation, you return to the view with journal entries that still need to be reconciled. You can then make another selection and reconcile these.  All the lines that cannot be reconciled, can be reconciled manually later using the Reconcile action button. Follow this procedure to reconcile the remaining entry lines. In this way you can reduce your list of journal entries.

Reconcile ledger account manually

Reconcile ledger account manually:

1. Go to: Financial / Enter / Reconcile.
2. Select the ledger account. If you do not see the account, switch on reconciliation in the account properties of the ledger account.
3. Click on: Finish.

   Profit displays a view with all entries that can be reconciled. If you have specified in the account properties that the account can be reconciled against another account, you see the entries for both accounts.

4. Set a filter if you want to make a selection of journal entries you want to reconcile.
5. Press: Ctrl+S if the column with the check boxes does not appear in the view.
6. Select the lines you want to reconcile. For this, select the check box for all the entry lines you want to reconcile against each other. Press Ctrl+A if you want to select the check boxes for all lines in one go.
7. Click on the action: Reconcile.

   An entry layout for manually reconciling entries appears. You see view which shows the entry layout with journal entry lines that need to be reconciled. These are based on the selection you made in the previous view.

8. Select the entry lines you want to reconcile against each other. You can see straight away whether the balance is right by checking the Balance column. Press Ctrl+A if you want to select the check boxes for all lines in one go.

   Note: 

   It is important to first sort everything properly in the entry layout before you start the reconciliation. This is because Profit reconciles the lines from the top downwards when it allocates reconciliation codes. If the balance + difference is 0, Profit allocates a new reconciliation code.

   You can write off small differences if the settings allow this.

   You can use the Write off discrepancy action button to reconcile entries that are outside the permitted limit for differences (in the financial administration settings). In that case a message appears that the difference falls 'outside' the set permitted difference. If entries with differences are reconciled, a general journal entry is generated. The difference is then booked to Balancing entries discrepancies account.

9. Click on: Finish.

   You now return to the view with entries that still need to be reconciled. If you still haven't reconciled all the journal entries, you can then once again make a selection and reconcile the remaining lines.