Eliminate the Challenges of Manual Cash Reconciliation with Automation
In accounting, cash reconciliation is the process of ensuring a firm’s recorded cash balance matches up with their bank statement. Without cash reconciliation, firms would lose control of their cash flow, making the process critical and a top priority for financial institutions. However, many continue to perform cash reconciliation manually, which can lead them down a path of challenges. As a result, firms are in search of a solution to help them automate the process.
The Challenges of Manual Cash Reconciliation
Cash reconciliation is a critical process that can improve a firm’s service levels, prevent fraud and ensure overall cash control. It helps firms identify where their ledgers and bank statements fail to match, allowing them to look into payments that may have been made accidentally or even fraudulently.
Although viewed as critical, cash reconciliation continues to be managed manually by many firms. This can cause their financial statements to be inconsistent and unreliable, as misstated cash in the revenue recognition system can lead to misstated revenue. Additional challenges with manual cash reconciliation arise when various teams within firms report different cash numbers, making it difficult to establish a single financial source of truth. Not only does this cause cash reporting inconsistencies, but it can also impact management’s decision-making abilities due to the use of erroneous data and over/underpayment of the firm’s tax obligations.
Long gone are the days of manual cash reconciliation, as the challenges that can potentially arise are too big to ignore. With this, firms are increasingly seeking a solution that can automate the process while simultaneously helping them to mitigate risks and boost their efficiency.
IVP Reconciliation Solution automates key steps of the cash reconciliation process by using a pre-defined set of criteria to match firms’ statements and ledgers together, which eliminates the need for the finance team to do so manually. Instead, their time can be spent doing other important financial activities.
Furthermore, the Reconciliation Solution provides a transparent view of data so managers can see exactly where and how breaks are occurring. This can help them fine-tune their workflow as they continue to use the solution, enabling increased efficiency of their processes going forward. Other key benefits of the solution include:
- Increased time efficiency through an AI/ML-based approach
- Generation of various types of reports (real-time, customized, unexplained, daily/month-end, etc.)
- Ability to match a large number of statements
- Elimination of accounting errors
- Reduction of fraudulent activities
- Adaptive matching rules
- Improved transparency
- A boost in team performance
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This reconciliation solution uses AI and ML to increase efficiency, accuracy, and flexibility. It features “any-to-any” reconciliations, including bank reconciliation, and processes millions of transactions in minutes.