Record to report / R2R – Reconciliations

You have read about the process components of an intercompany reconciliation process:

These were:

  • Statement collection
  • Balance confirmation
  • Listing of differences
  • Reconciliation
  • Timing differences segregation
  • Resolution
    • Evidence collection
    • Negotiation
    • Approvals

Now if you really look at the above processes, are they really only for intercompany reconciliations? Not at all. They, in a generic manner apply to all possible reconciliations with entity variations primarily. Whether you need to reconcile your vendor or your customer accounts, or for that matter Bank accounts, most of the steps will be the same. For vendor accounts the reconciliations will be between vendors and the particular business unit, for customers it will be with the accounts maintained by the ongoing customers.

Some critical factors will be covered by me for each type, but I will not get into process steps for others, except that I shall cover the unique areas / process steps.

Next time I will cover the second type of reconciliation, which sometimes poses some unique challenges, i.e.

    • Multiple systems – different ERPs in use in various units / legacy to current systems


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