Reconcile bank transactions to the ledger
Bank feed lines are matched to invoices, bills and journal entries by rules first, then by a model for the leftovers. Proposed matches are posted once confirmed, and unexplained items are listed with a suggested cause. Meant for accounting teams that spend the first days of each month clearing a bank rec.
Function: Finance · Industry: Any industry
Reconcile bank transactions to the ledger
6 steps
At a glance
- Trigger
- A bank statement or feed refreshes, or the period-end reconciliation starts.
- Typical inputs
- Bank feed or statement files
- Open invoices and bills
- Payment processor settlement reports
- Matching rules and naming patterns by counterparty
- Systems it usually connects to
- QuickBooks
- Xero
- NetSuite
- Google Sheets
- How the work splits
4 rules, 1 model, 1 person steps
How it runs, step by step
6 steps, each tagged by what does the work. Rules are fixed logic, a model reads or drafts, and a person decides.
- Rules Fixed logic in code
- Model AI reads or drafts, with a confidence score
- Person A named person decides
- 1
Normalize the feed
RulesBank lines are cleaned: dates, signs and reference fields are standardized, and transfers between your own accounts are paired.
- 2
Match on exact references
RulesInvoice numbers, payment references and processor payout IDs are matched to open items, including one-to-many payouts.
- 3
Match what is left
ModelA model compares the description, amount and counterparty to open items and past matches, and proposes the most likely pairing.
- 4
Post confirmed matches
RulesMatches above your confidence bar are posted; fee lines and known recurring items use standing rules.
- 5
Clear the exceptions
PersonAn accountant reviews the unmatched list, each item with a suggested cause, and posts adjustments or asks for support.
- 6
Lock the reconciliation
RulesThe rec is produced with a check that book and bank balances agree, and the period's matches are frozen.
Where people approve
The decisions that stay with your team, whatever the confidence score says.
- An accountant reviews every model-proposed match below the auto-post threshold.
- The controller signs off the finished reconciliation.
- Write-offs and adjustments need an approver above the preparer.
KPIs to track
What to measure, before and after. Targets come from your own baseline.
- 01Share of bank lines matched without review
- 02Number and age of unmatched items at close
- 03Days to complete the bank rec after month-end
- 04Adjustments posted after sign-off
Questions about this workflow
How does it handle one payment covering several invoices?
Exact references and settlement reports are checked first. When a customer pays five invoices in one transfer with no remittance advice, the model proposes the combination that adds up and a person confirms it.
Can it post to the ledger on its own?
Only for matches you have allowed, such as standing fee lines or exact-reference payments. Everything proposed by the model waits for confirmation until its accuracy on your data justifies relaxing that.
Which steps use rules, a model and a person?
Rules: normalize the feed; match on exact references; post confirmed matches; lock the reconciliation. Model: match what is left. Person: clear the exceptions. Rules are fixed logic in code. A model reads or drafts and reports its confidence. A named person decides.
What do we need to start?
Typically: bank feed or statement files; open invoices and bills; payment processor settlement reports; matching rules and naming patterns by counterparty. You also need read access to QuickBooks, Xero, NetSuite and Google Sheets, or the equivalents you use. A workflow audit measures your volumes and past cases first, then gives a fixed price for the build, so you can decide with real numbers.