How Bank Reconciliation Software Can Boost Efficiency

For many businesses, day-to-day operations will involve several financial transactions, both inbound and outgoing. As funds move around, it is important for businesses to keep on track of payments, invoices, and transactions made to and from other accounts – both within and without. If accurate records aren’t kept, this could lead to missing payments, unpaid invoices, and errors on the bottom line.

With this in mind, maintaining accurate, up-to-date records on all financial transactions should be standard procedure for all businesses. With the help of bank reconciliation features from Klyant, clients can reconcile transactions across all bank accounts with efficiency and ease. In this blog, we’ll explain what bank reconciliation is, and explore the various ways bank reconciliation software boosts business efficiency.

What is Bank Reconciliation?

The term ‘bank reconciliation’ refers to the administrative task of comparing bank statements, to other financial records to optimise record accuracy. Bank reconciliation helps businesses keep on top of their finances and allows any inconsistencies or errors to be flagged for investigation.

Without bank reconciliation, record errors can go undetected, leading to figures and reports that are inaccurate - not to mention potential loss of money. Using bank reconciliation software also increases the likelihood of businesses becoming aware of any theft or fraudulent activity associated with their accounts.

Bank reconciliation provides a kind of verification process for financial records – if checks against relevant statements reveal an inconsistency, reconciliation can allow for timely action to be taken to recover any lost or erroneous figures. During bank reconciliation, items are assessed, such as:

• Cheques
• Withdrawals
• Deposits
• Other transaction varieties

By taking the time to check all of these key financial areas, businesses are granted greater peace of mind about all of their financial activities, without worrying if any important checks have been missed.

Types of Bank Reconciliation Procedure

Bank reconciliation procedures generally fall within three main categories, these being:

1. Internal reconciliation: reviewing entries from within one organisation.
2. External reconciliation: comparing accounts across different sources, e.g. two different businesses.
3. Aggregate reconciliation: reviewing several accounts from different sources, comparing them against one set of account documents and records.

Efficiency Benefits of Reconciliation Software

Regular bank reconciliation boasts a range of advantages for businesses, including several efficiency-boosting benefits. Ways in which bank reconciliation can improve efficiency for businesses include:

Detecting Errors

If your business makes and receives a lot of payments, it can be easy for erroneous payments to fall unnoticed. As undetected errors mount up, they can make a serious difference to the accuracy of a business’ records.

With bank reconciliation software, businesses are able to identify if an issued receipt has not been paid. When this is detected, invoices can then be reissued, and a business can retrieve the balance owed. The opposite can also happen, whereby an issued receipt is not visible on a business’s books.

Reviewing Performance

In addition to providing insights on which services may have been charged incorrectly, bank reconciliation also allows businesses a look into which elements of their business may not be working as well as they could be.

This might allow for changes at the product level, department level and beyond. Bank reconciliation may also signpost a need to invest in new technologies and procedures, or alter product or service offerings in line with observable trends.

Verifying Income and Expenses

For businesses with lots of clients, suppliers and service providers, keeping on track of incoming and outgoing funds can be challenging – and finances can easily get out of control. Bank reconciliation makes keeping on top of accounts simple for businesses. Fuss free bank reconciliation with Klyant is also accessible on the go – making updating records simple and easy to complete.

Build and Maintain Healthy Relationships

Regular and effective bank reconciliation also allows businesses to improve and maintain relationships. By maintaining accurate records, businesses are able to offer professional transparency to those with whom they work – whether this be about missed payments, overpayments, rate changes or wider financial decision-making that may impact them. Operating in a transparent way allows businesses to gain the trust of their clients, leading to long-lasting, mutually beneficial professional workings.

Increased Financial Control

Maintaining an accurate overview of your business’ finances also helps maintain overall financial control over your business’ finances. By regularly obtaining clear information about its balance, businesses are able to forecast with greater accuracy, make future plans and review any need for changes. This increased financial control can also help businesses make more informed investments.

Streamline Your Bank Reconciliation with Klyant

Our legal accounting software allows businesses to reconcile both client and office accounts with ease. Our easy to use, beautifully designed bank reconciliation features give users the opportunity to reconcile transactions and speed up their legal accounting processes. In addition, our autosave feature offers users peace of mind that their reconciliations will not be lost if they are abandoned mid-process – meaning no progress is lost and a project can be revisited at any given time.

To find out more about how bank reconciliation with Klyant could help boost efficiency for your business, contact our team today.

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