Record to report / R2R – Reconciliations

 In the record to report (R2R) segment, we started by listing a bunch of processes that may be a part of this segment. The links are given below for a quick reference:

Let us start today with detailed process understandings of the R2R processes, commencing with the simplest, yet most tedious, i.e. reconciliations. Some of you, who have been following the blog closely will come back to me and say, we covered reconciliations in the accounts receivable….

Yes we did, but we looked at only customer account reconciliations. http://faoblog.com/processes-ar-collections-customer-account-reconciliations/

Reconciliations form an integral part of multiple accounting segments, even in accounts payable, vendor reconciliations are an important process.

In the record to report / R2R segment, the following types are in vogue:

  • Reconciliations
    • Intercompany – for transactions between various units of the company
    • Multiple systems – different ERPs in use in various units / legacy to current systems
    • Bank – standard reconciliations between records maintained by the bank / banks and the accounting department
    • Subsidiary to main set of books – accounts payable / accounts receivable module to general ledger, journal module to again general ledger, cash / bank modules to the general ledger

In some cases these also are included as a part of the reconciliation R2R process component.

    • Customer
    • Vendor

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