Invoice reconciliation is the process of matching bank statements to the outgoing and incoming invoices to make sure that all accounts are clean, and every book entry is correctly matched.
Invoice reconciliation also involves the verification and matching of the information inside each invoice.
Reconciliation in accounting is comparing two or more sets of numbers to ensure they are consistent and accurate. For example, it may indicate that the company is attempting to settle all accounts payable and bills within a specified time frame.
Discrepancies and disagreements often result from a financial mistake made by the bank or the company. Conflicts can be resolved with the use of invoice reconciliation. There is the option of doing it manually or thorough software systems. This settlement procedure is therefore critical to enterprises resolve issues or minimize discrepancies.
In addition, regular invoice reconciliation might reveal which clients have still not paid. As a result, contacts can be made at the appropriate time to collect overdue payments. Identifying fraudulent activity is critical to keeping a company afloat. Detecting fraud requires a robust reconciliation procedure.
Reconciling the books to the bank statements allows the business to retain meticulous daily records of all financial transactions.
Traditional procurement systems are riddled with inefficiencies, and invoices are no exception. But technology is bringing about transformative changes in the way businesses operate. Inefficient, legacy business practices are getting replaced with advanced productivity tools, most of which are cloud based. What this means for invoice reconciliation is a radical transformation how accounting is managed with end-to-end visibility.
Continue read to explore GEP’s invoice reconciliation software.