The end of each accounting period is chaotic in any finance department. In order to ensure that everything runs smoothly the correct procedures need to be in place. Establishing set procedures and improving processes in this area gives the accounts payable statement reconciliation team efficiency, enables quality output and ensures uniformity of performance, while reducing miscommunication.
Before month-end the accounts payable statement reconciliation team needs to verify that the total of all accounts payable outstanding amounts match the payables account balance stated in the general ledger. This ensures that the books are correct. This process is called accounts payable statement reconciliation.
Accounts payable statement reconciliation encompasses the following steps:
- A supplier statement is a document received from your supplier’s accounting system which lists all unpaid invoices at a certain period. It also encompasses uncleared items such as credit notes and payments.
- Reconciliation requires matching of the invoices and other documents from your own system with those on the supplier statement received. Your accounts payable statement reconciliation team then needs to reconcile manually either by highlighting, ticking off line by line or using V-lookups in excel to see whether there are matches or not.
- All the unmatched items are the ones listed on your reconciliation report. This is basically where there are discrepancies between your books and the books of your suppliers as well as the reasons for the discrepancies. This reconciliation report identifies all missing credit notes, over-payments as well as potential duplicates. It further confirms that the money leaving your business matches the amount that’s been spent, and ensures the two are balanced at the end of the recording period.
- Now the accounts payable statement reconciliation team needs to resolve queries with their suppliers to try and resolve these discrepancies.
- As a last step the reconciliation is approved and signed. This final reconciliation then needs to be filed for auditing purposes.
Accounts payable statement reconciliation is a critical process that ensures accurate financial reporting. It is surprising with technology available today that most business are still doing this manually. BEST AP Module does supplier statement reconciliation directly in SAP and is a SAP certified module. Now your accounts payable statement reconciliation can be done directly in SAP.
For more information on this all-inclusive solution that provides easy upload and reconciliation – Automate your accounts payable statement reconciliation today by finding our more and contacting us for a demo: https://bestsapcbi.com/supplier-statements-reconciliation-sap/