词条 | Reconciliation (accounting) |
释义 |
In accounting, reconciliation is the process of ensuring that two sets of records (usually the balances of two accounts) are in agreement. Reconciliation is used to ensure that the money leaving an account matches the actual money spent. This is done by making sure the balances match at the end of a particular accounting period.[1] DefinitionThe following two definitions are given by the Oxford Dictionary of Accounting. i) “A procedure for confirming that the balance in a chequebook matches the corresponding bank statement. This is normally done by preparing a bank reconciliation statement.[2] ii) A procedure for confirming the reliability of a company’s accounting records by regularly comparing [balances of transactions]. An account reconciliation may be prepared on a daily, monthly, or annual basis.”[2] GAAP (The Generally Accepted Accounting Principles) are a set of accounting principles, procedures and standards that organisations use in order to compile their financial statements. GAAP states that the purpose of account reconciliation is to provide accuracy and consistency in financial accounts. To ensure all cash outlays and inlays match between cashflow statements and income statements it is necessary to carry out reconciliation accounts.[3]Reconciliation is a process that may benefit businesses as this may help avoid balance sheet errors which may have led to detrimental ramifications, in addition reconciliation may help against fraud and can help instill financial integrity. Accounting software is one of a number of tools that organisations use to carry out this process thus eliminating errors and therefore making accurate decisions based on the financial information. Reconciliation of accounts determines whether transactions are in the correct place or should be shifted into a different account. Reconciliation in accounting is not only important for businesses, but may also be convenient for households and individuals. It is prudent to reconcile credit card accounts and chequebooks on a regular basis, for example. This is done by comparing debit card receipts or check copies with a persons bank statements. The benefits of reconciling:=
Account reconciliation is an important internal control in the financial reporting process. Public companies are required to perform these steps as part of their financial close.[4] MethodsTo ensure the reliability of the financial records, reconciliations must, therefore, be performed for all balance sheet accounts on a regular and ongoing basis. A robust reconciliation process improves the accuracy of the financial reporting function and allows the finance department to publish financial reports with confidence.[5] There are two ways in which reconciliation can take place:
In both cases where mistakes are identified as a result of the reconciliation, adjustments should be undertaken in order for the account balance to match the supporting information. Current practiceCurrently there are no specific account standards for accountancy reconciliation per se. However, there are different rules for balancing many types of accounts. There are no specific regulations mentioned by IAS, ICAW and HMRC. GAAP provide different rules in regards to reconciliation to balance different types of accounts. According to GAAP, account reconciliation is a process that is performed through account conversion or double-entry accounting.[9] Manual reconciliation to automationIn the United States, the passage in 2002 of the Sarbanes-Oxley Act (SOX) has emphasized the need for balance sheet account reconciliation to be included within a company's own procedures, not relying only on external auditors.[10] The legislation was enacted “to protect shareholders and general public from accounting errors and fraudulent practices in the enterprise, as well as improve the accuracy of corporate disclosures.”[11] SOX and other acts like it across the world have increased stress on organisations to comply. As a result, the accounting industry has sought ways to automate a previously strenuous manual process. The pressure of SOX coupled with the perennial need to mitigate erroneous reconciliation in the process. By using all of the information technology available, organizations can easily automate their reconciliation and for each financial close cycle less manual labour would be required. 90% of companies manually reconcile using Microsoft Excel spreadsheets in order to do so.[12] This process is arduous allowing for further human error. Automating reconciliation can significantly reduce aforementioned errors and increase efficiency. Further benefits of automated reconciliation include centralised control, improved monitoring, reduced operational costs, increased productivity and efficiency, improved accessibility, data security improved and reduced audit risks and costs. See also
References1. ^Jean Scheid, "Understanding Balance Sheet Account Reconciliation", Bright Hub, 8 April 2011 2. ^1 Owen, G. and Law, J. (2005). A dictionary of accounting. Oxford: Oxford University Press. 3. ^Investopedia, (2003). Generally Accepted Accounting Principles (GAAP) Definition | Investopedia. [online] Available at: http://www.investopedia.com/terms/g/gaap.asp#ixzz3qTbiuFxO [Accessed 3 Nov. 2015]. 4. ^{{Cite web|url=https://www.blackline.com/blog/account-reconciliations/what-are-account-reconciliations/|title=What Are Account Reconciliations?|date=2017-11-02|website=BlackLine Magazine|language=en-US|access-date=2019-02-07}} 5. ^"Intercompany Reconciliations", Instant Controller, 27 December 2010 6. ^Ventureline.com, (2015). DOCUMENT REVIEW DEFINITION. [online] Available at: https://www.ventureline.com/accounting-glossary/D/document-review-definition/ (Accessed 3 Nov. 2015) 7. ^TheFreeDictionary.com (2015). Analytical Review. Online [Available at: http://financial-dictionary.thefreedictionary.com/Analytical+Review] (Accessed 4 Nov. 2015) 8. ^Bragg, S. (2013). How do I reconcile an account? - Questions & Answers - AccountingTools. [online] Accountingtools.com. Available at: http://www.accountingtools.com/questions-and-answers/how-do-i-reconcile-an-account.html [Accessed 3 Nov. 2015]. 9. ^Investopedia, (2015). How is reconciliation treated under generally accepted accounting principles (GAAP)?. Available at: (Accessed 4 Nov. 2015) 10. ^James Brady Vorhies, "Account Reconciliation: An Under appreciated Control", Journal of Accountancy, 1 September 2006 11. ^M. Rouse, (2015). What is Sarbanes-Oxley Act (SOX)? - Definition from What Is.com. [online] Archdiocese. Available at: http://searchcio.techtarget.com/definition/Sarbanes-Oxley-Act [Accessed 2 Nov. 2015] 12. ^M. Spanicciati, ‘How automating balance sheet account reconciliation can lead to a real return on investment’, Financial Management (Sep. 2013), p. 57 1 : Banking terms |
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