Wednesday, 20 April 2016

Reconciliation of Accounts: Do You Really Need It?

Are you an entrepreneur OR Running an organization OR Witnessed some unwanted changes or miscalculations in your accounts?


If all these questions are relating your situation, then it can be an alarming time for you to pay attention towards your accounts. Checking out the accounts of your whole organization is really not a piece of cake. You might need to walk a mile extra to analyze the defaults and then make corrections in it.

Well, every organization has their own accounting department to deal with such matters. Before we move further start grasping knowledge over how to reconcile accounts, I suggest to take a look at the literal meaning of ‘Reconciliation of accounts’ and ‘Accounts reconciliation services'.



What is reconciliation of accounts?

The term  ‘Reconciliation of accounts’ is enough to make you understand that it relates to the affairs of accountancy. Basically, it is an accounting procedure where two different sets of accounting records (balances and accounts) are analyzed.

Generally, every nook and cranny expense of an organization  is kept in the accounts book, so the actual amount and exact expenses made can be looked for whenever required. When this account book holds the details of every major or minor expense of an organization or individual, then it should relate to each other at the end of the accounting period.

But apparently when things don’t go right in the expected manner, then putting your nose in between the accounting matters becomes a must.

Well, now when we have gathered enough information over reconciliation of accounts, now its time to know what ‘Accounts reconciliation assistance’ is all about?

If your accounting manager committed minor mistakes it can hit hard on your pocket. Always keeping an eye on the expenses of the organization can save you from going through such stressful circumstances. The basic motive of conducting accounting reconciliation assistance is to thoroughly check out the accounts book.

It is acknowledged as a verification procedure which is generally seen executed by highly experienced accountants only. In order to safeguard your financial condition, reconciliation after a particular time of span is a must to conduct thing.

Some scholar accountants always suggest to perform the reconciliation procedure over your balance sheet on a regular basis can help you wave off your worries at later stages of financial reporting.

With the help of account reconciliation software, this process can be performed with greater ease.
Here is a list of a few of best accounting software which are recommended and used by almost every accountant. Take a look.
  •      Pro tax
  •      Sage Line 50
  •      Peachtree
  •      Quicken
  •      IRIS
  •      Xero
  •     Quickbook
  •     Netsuite
  •  By documentation reviewing- While practicing this process, initially the previous accounting documents are paying attention to. In general, this activity is acknowledged as ‘data collection.’ With this, analyses of the previous financial year documents are also executed. If done manually, this process can consume your never ending time, so it is wise to go for any above mentioned account reconciliation software that helps you get a better and faster access over data collected.
  • The analytic review- Here in this process two important aspects (previous information and estimated transactions) helps you completing the account analyzing procedure. Taking help of the previous year financial statements can really sort out things for you. Once all the data required is collected, then the next step is to perform the comparison activity among (financial and non-financial data information) which ultimately lets you have the clear results in front of you.
  • Helps detect accounting blunders that can cost you hard if not detected at the right time.
  •  Lets you have an overview of your whole year spending and savings too.


Usually, there are two different ways that are used to in order to conduct the reconciliation procedure. 

To perform this kind of analyses your estimation power should be good, as you need to estimate the last transactions on your account to make the balance sheet accurate. The estimation basically is made in accordance with the previous transactions. 

Is it really important to have a reconciliation of accounts done? What are its benefits?
Whichever is the method of reconciliation, the basic aim is to find out the faults and then correct them up.  

Want to reconcile your bank and credit card statements? We have a highly qualified and experienced team that specialized in reconciliation process. For more information please contact us at info@cogneesol.com.





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