SOP: Bank Reconciliations: Stage I: Recording Bank Statements

SOP: Bank Reconciliations
Aim
The following explains how to reconcile bank statement items with journal entries that are recorded
in Priority.
Working Assumption
 Bank accounts are defined in the system, together with any currencies of foreign accounts.
Procedure
Stage I: Recording Bank Statements
1. Enter the Record Bank Statements form.
2. Select the appropriate internal Bank Account Code. If this is the first statement for this account,
record the Opening Balance.
3. Enter the sub-level form, Itemized Statement, and record all items that appear on your bank
statement.
4. Select the desired Transaction Code. You can use the default Miscellaneous transaction.
5. Record brief remarks in the Details column, describing each item, to facilitate reconciliations.
Result:
 Bank statements are ready for reconciliation. They are now stored in the system as unreconciled
journal entries.
Stage II: Performing Reconciliations

1. Run the Prepare for Reconciliation program.
2. Select the internal code of a single bank account. Also select a date and transaction code (the
latter is optional). All unreconciled entries in the system that meet the criteria you have specified
will be prepared in the work area.
3. Choose between two types of reconciliations–automatic or manual. You can also take care of
variances and perform reconciliations for statement items that have no corresponding journal
entries.
To perform automatic reconciliations:
 Run the Automatic Reconciliation program.
Result: The system "suggests" reconciliations between entries that ought to be reconciled with
one another. At this stage, the reconciliations are only pending.

Customers are strongly advised not to use the current procedures without prior testing to make sure that they fit their
own requirements and work practices.
w w w . pr i o r i t y - so f t w a r e. c o m
Cat.No. LB17000112 Ver.01 Apr. 09,'17 1/3
 Enter the Reconciliation Worksheet form. Entries that were reconciled by the system have
been assigned identical numbers in the Reconciliation Num. column. If the work area was
"clean" before you started, the first number will be "1".
 To approve a single reconciliation, move the cursor to one of the entries that share the same
number and click Finalize Reconciliation from the list of Direct Activations.
 To approve all reconciliations in the work area, run the Finalize Reconciliations program.
Note: To omit a given set of entries, remove their reconciliation number from the work area
before running the program.
To perform manual reconciliations:
 Enter the Reconciliation Worksheet form.
 Move to the row of the entry you want to reconcile.
 Enter the Entries for Reconciliation sub-level form. This form displays entries from the same
ledger with sums equal to (or lower than) the amount appearing in the upper-level form.
 Move to the appropriate line and assign the entry in question a Reconciliation Num.
 Return to the upper-level form. The same number you have recorded in the sub-level is
allotted automatically to the entry in this form.
 To finalize a single reconciliation, move to the line in question and run the Finalize
Reconciliation program by Direct Activation from the form.
To perform reconciliations that include variances:
 Move to the lines that you want to reconcile and record the same number for them in the
Reconciliation Num. column.
 Enter the Reconciliation Status sub-level form. If there is variance between the reconciled
entries, it appears here.
 To transfer the variance to an adjustment account, return to the upper-level form and run the
Finalize Reconciliation program by Direct Activation from one of the lines in question. An
input screen will open in which you can record the definitions for the adjustment entry.
Result: The reconciliation is finalized and a journal entry is created that debits or credits the
adjustment account with the sum of the variance.
To perform reconciliations for statement items that have no corresponding journal entries:
 In the upper-level form select one or more lines that have a sum in the Statement Amount
column, and record the same number for them in the Reconciliation Num. column.
 Run the Finalize Reconciliation program by Direct Activation from one of the lines in
question.
o If you are reconciling a single line, record the details of the adjustment entry that will be
created in the input screen.
o If you are reconciling several lines, an input screen will open in which you can choose
whether to record a separate adjustment entry per line or one entry for all lines.
o In the next input screen, record the details of the adjustment entry(s).
Result: The reconciliation is finalized and one or more journal entries are created against the bank
entries.
Cat.No. LB17000112 Ver.01 Apr. 09,'17 2/3
To finalize any remaining reconciliations in the work area:
 Run the Finalize Reconciliations program.
Results:
 Bank statement items are reconciled with journal entries in Priority.
 The adjustment account is debited/credited for the variance in a journal entry.
 Adjustment entries have been created against bank statement items that have no corresponding
journal entry items.
 In the Reconciled Transactions and Unreconciled Transactions sub-levels of the Chart of
Accounts, you can see those entries for an account that have been reconciled and those that
still need to be reconciled.
Stage III: Canceling Pending and Final Reconciliations

1. To cancel a pending reconciliation:
 Enter the Reconciliation Worksheet form and move to the line you want to cancel.
 Click Cancel Pending Reconcil'ns from the list of Direct Activations.
2. To cancel a final reconciliation:
 Enter the Bank Statement Items form and retrieve the statement item whose reconciliation
you want to cancel.
 Run the Cancel Reconciliation program by Direct Activation from the form.
Note: You can also run the program from the Itemized Statement form (sub-level of the
Record Bank Statements form).
3. To cancel a batch of final reconciliations:
 Run the Cancel Final Reconciliations program.
Select the internal bank account code and indicate the range of reconciliation numbers to
cancel.
Stage IV: Preparing Final Bank Reconciliations

This stage allows you to view all journal entries reconciled with bank statement lines.
1. Run the Prepare Final Reconciliations program.
2. Select the internal bank account code and indicate the range of reconciled entries to prepare,
based on their due dates.
3. Enter the Final Reconciliations form.
4. Use it to retrieve by reconciliation number, dates, references and/or bank account.
Cat.No. LB17000112 Ver.01 Apr. 09,'17 3/3

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SOP: Bank Reconciliations

Stage II: Performing Reconciliations

Stage III: Canceling Pending and Final Reconciliations

Stage IV: Preparing Final Bank Reconciliations

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