Examples of GL reconciliation use cases

Hi Andrew,

Thanks for raising this.

GL Reconciliation is built to work within a single legal entity, that's why you can only select one there. You can set up a rule against one entity using the interco attribute, but that only picks up transactions where that attribute has been applied, so it won't cover the full scope of intercompany activity.

To check that balances between entities are correct, use the Interco Balances enquiry instead. Search 'interco' in the main quick search bar to bring it up.

This gives you a grid showing the total intercompany position between each legal entity pair. If everything's matched, the entries offset each other and the Total Interco figure comes out at zero.

If it doesn't, for example if one entity shows -1,400 against another but that entity only shows -300 coming back the other way, you've got a mismatch. Click on any total in the grid and it'll drop you into the underlying transactions so you can trace exactly where the imbalance is coming from.

If you need further support with this, please raise a support ticket by clicking here and we would be happy to take a closer look for you. 

Hi There

Is it possible to let me know how you can do intercompany reconciliations between legal entities? I have setup a Intercompany GL reconciliation but it appears to only let you select one Legal Entity.

Thanks

GL reconciliations are commonly used for balance sheet accounts and suspense accounts. Payroll and HMRC-related accounts (such as PAYE) are common use cases, along with deposit accounts and provisions such as bad debt. Accruals and prepayments are also frequently reconciled this way.

Other examples customers use GL reconciliations for include:

• VAT control accounts, matching VAT charged and reclaimed against the VAT return submitted
• Loan and directors' loan accounts, tracking drawdowns and repayments against the GL balance
• Fixed asset control accounts, reconciling the asset register to the GL asset cost and depreciation accounts
• Stock and inventory control accounts, matching physical stock movements to the GL
• Wages and pension control accounts, reconciling net pay, pension contributions, and other payroll deductions before payment
• Credit card clearing accounts, matching card transactions to statements before they clear to the bank
• Grant or restricted fund accounts, tracking that fund balances match designated income and expenditure
• Lease liability accounts, reconciling lease schedules to GL balances
• FX revaluation and translation accounts, confirming unrealised gains and losses tie back correctly after revaluation runs

You can also use GL reconciliations for P&L accounts where there's a suitable use case. Some of the examples above, such as wages control and VAT control, sit on the P&L side and are just as common as the balance sheet examples.

For further reading:

• General Ledger Reconciliation guide
• General Ledger Reconciliation Rules guide