Debtors and creditors reconciliation

Others 5250 views 4 replies

Hi All, 

Please explain me the concept and procedure to do the debtors and creditors reconciliation.

Thanks

Ali

Replies (4)
Reconciliation is what there is different balance in books we maintain and third party confirmation means your balance with your creditors.
The main reason behind this is there are some purchases which he had been recorded and as they had not been delivered to u so u didn't record them.
Or cheques in transit.
Give effects of these and u will get balnce matching.
It's similar to bank reconciliation to certain extent

It's better to get a confirmation of Balance from each debtor & creditor (either by attaching our statement or as available in tally format) then we have to check if any bills, payments & adjustments made by each left out to be resolved before finalisation since unnecessarily the difference will carried over & affects profit/loss

Meaning - Debtors and Creditors reconciliation is a process of comparing the balances of a company's accounts receivable and accounts payable to ensure that they are accurate and match the records of the company's customers and suppliers. The objective of this reconciliation is to identify and correct any discrepancies that may exist in the accounts, which can help to reduce the risk of errors and fraud.

Debtors are seperate from creditors. We reconcile them seperately. They are segregated as per their aeging schedules and credit ratings. As per the as standards, if netting is allowed, they will do it. 


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register