Bank Statement and Reconciliation
Bank reconciliation is the process by which a person’s accounting records with respect to cash account is matched with the information of his bank statement. The main aim of the process is to find out the difference between these two records so as to keep the accounting records as appropriate as possible. The bank information encompass the record of all transactions carried under a person's account for a month. The reconciliation process should be carried out at regular intervals so as to ensure that a company’s cash record are correct, immune to fraudulent activities and also mitigation of problems with respect to bounced checks and overdraft fees.
Odoo enables easy linking of your invoices and all other payment details with the bank statements without hardship. The reconciliation methods in Odoo are carried in two formats;
- Direct registering of payment with invoices.
- Open invoices reconciled with bank statements.
Step 1: Make Bank Payment
First of all, create an Invoice for the customer.
For that go to Accounting->Customers->Invoices
Create an Invoice.
When the customer makes the payment, click REGISTER PAYMENT.
A company accountant handles the bank statements only on weekends, correspondingly the invoice will be marked as paid. It is done so as to remember that the service with our customer can be started. Payment confirmation is send from the customer side, so payment registration can be done and the invoice can be marked as paid. If clicking the REGISTER PAYMENT option, it is marked in Odoo software that the invoice is paid. The payment method, payment amount and payment date has to be specified here.
To find the payment back from the invoice, clicking the green little icon. You will get with the payment information. You can see the reconciliation process automatically done.
Bank statement reconciliation case
Import or create bank statements. From the banks feed section, the documents have to be referred.
There will be an option in the dashboard to reconcile X number of items (X denotes the number of items we want to reconcile), click on that.
If the mentioned name of the partner, the amount entered etc. are correct, Odoo software automatically execute the reconciliation process.
The above image shows the successful execution of all reconciliation process.
Now, suppose if some issues happen during the process, like the partner name missing out, amount getting mismatched, in that case, one has to make use of manual actions.
Suppose if the partner name is not there in the bank statement, there you have to manually enter it.
If down payment method is adapted, one has to check if it is right and then payments should be validated accordingly.
There is an option to reconcile balanced items in the sheet. For that press CTRL-enter.
RECONCILIATION MODELS
One can pre-fill in Odoo certain accounting entries so as to easily reconcile them. Seamlessly reconcile recurrent entries such as bank fees.
Creating Reconciliation Models
Go to Accounting>Configuration>Accounting>Reconciliation Models.
Or else one can go to the Bank journal under accounting application dashboard and click on More ‣ Reconciliation Models.
Click RECONCILIATION MODELS.
Click the CREATE button for creating new model.
Let’s take a use case. Every month a company receives a bank fee cost based on its current balance. Hence, the fee is variable.
Let us keep the model name as Bank fees, select the correct account to book those fees. Also specify the amount type. Based on the provided parameters, Odoo takes the fee into the account.
Click SAVE button, to mark the changes.
Registering payments based on reconciliation model
Register your payment via importing your bank statements.
During the reconciliation process, select open balance. Then click on reconciliation model, here it is the bank fees. After doing this, one will instantly get the relevant data. To finish the process, click on reconcile.