Financial Year End?
Balancing Ledgers Ready for auditors?
How much time do you spend on average in reconciling ledgers and ensuring that the balances balance?
Are you confident that you are doing this correctly and you’re doing it the best way possible?
With our hints and tips on How to Reconcile in Sage 200, you will be well on your way.
3 Key Factors to reconciling in Sage 200:
- The Nominal Ledger is controlled by the status of the accounting periods
- Aged Creditors and Aged Debtors are based on Allocation Date instead of posting date when running retrospectively.
- Always best to start off with the question ‘does it balance to now?’ Before even looking into reconciling retrospectively.
To reconcile the Sales Ledger and Debtors Control follow these simple steps…
Step One: Get the Sales Ledger Balance
You need the total balance for all Sales Ledger accounts, and there is more than one way to do this…
OPTION 1. Using the ‘Aged Debtors (Summary)’ report (This can be accessed Sales Ledger- Reports- Credit Control- Aged Debtors (Summary)), and when the criteria appears leave ‘as is’- i.e. do not add or filter by ANY criteria.
Then make a note of the Balance at the bottom of the report.
OPTION 2. Using Ledger Summaries (This can be accessed via Accounting System Manager- System Utilities- Ledger Summaries) and selecting ‘Sales Ledger’ from the drop down. Use the field called “Current Ledger Balance”.
OPTION 3. Using the Transaction Listing Report (Accessed via Sales Ledger -Reports) and making a note of the ‘base outstanding total column’
*This only works if all your customers are ALL in base currency*
Highlight all customers in the customers list, and make a note of the Total Balance at the bottom of the screen
Step Two: Nominal Ledger Balance
You need the total balance for the Debtors Control Account, and, again, there is more than one way to do this…
OPTION 1. Using the ‘Trial Balance Report’ (Nominal Ledger- Reports- Financial Statements- Trial Balance Summary).
When the criteria appears leave ‘as is’. Make a note of the Year to Date Balance on the Debtors Control Account
OPTION 2. Using the Nominal Accounts List- Find the Debtors Control account in the list and make a note of the balance on the account
OPTION 3. Using the Nominal Accounts Enquiry Workspace (Nominal Accounts – Nominal Enquiries – Nominal Accounts Enquiry Workspace) and filtering by the Debtors Control Account. Make a note of the balance year to date
What to do if there are differences…
IF THE BALANCE ON THE NOMINAL IS GREATER THAN THE BALANCE ON THE SALES LEDGER:
Report Pending Transactions (Sales Ledger- Period End Routines- Report Pending Transactions) – Does this account for the difference?
Q. How are transactions in pending transactions?
A. Transactions will be in here if you use Sales Order Processing and your SOP settings Order Processing is not set to ‘Add directly to the Sales Ledger’. You can update these by the menu item just below (Sales Ledger – Period End Routines – Update Pending Transactions) saying ‘update pending transactions’.
IF THE BALANCE ON THE SALES LEDGER IS GREATER THAN THE NOMINAL LEDGER.
Perhaps you have waiting postings? Check the following reports:
Current Waiting Postings Report (Nominal Ledger- Reports- Account Analysis- View Waiting Postings Report)
Deferred Waiting Postings Report (Nominal Ledger- Reports- Account Analysis- View Waiting Postings Report Deferred)
When running these reports remember to specify the debtors control account number and make a note of the difference between the credit and debit values waiting to post to this account. Does this value relate to the difference in your figures?
Q. How do Waiting Postings happen?
A. There is definitely enough detail to write about this in another blog for another time, but just to give you the basics for your reconciliation queries. The Nominal Leger is an accounting Period controlled Ledger. Therefore using the transaction date the system checks what the status of the corresponding accounting period is and makes the following postings.
‘Closed’ – The transaction will be posted into the next open period.
‘Open’ – The transaction will be posted into the ledger.
‘Future’ – The transaction will go into ‘deferred waiting postings’ until the period is opened at which point it will move to ‘current waiting postings’ awaiting the user to run the ‘update waiting postings routine’.
Have a look if any journals have been posted into the Debtors control account? If so, this amount will not have affected the Sales Ledger so will play a part in any differences. You can view journals easily by running the report in Nominal Ledger- Reports- Account Analysis- Manual Journal Listing. (remember again to only run this for the debtors control account)
Finally: This routine should only be run AFTER TAKING A SQL BACKUP and when all users are logged out of the system. Run the Balance Ledgers Routine from Accounting System Manager- System Utilities- Balance Ledgers- Financials.
Run this for both the Sales Ledger and Nominal Ledger.
If there are still issues, go on your holidays…
Next, would be to manually use the transaction listing reports for the Sales Ledger and the Debtors Control account, then export to csv to go through and locate any transactions that are missed from either ledger.
It’s at this point you realize how important it is to balance your ledgers on a regular basis so that when your looking for an error, at least you have a better idea of which transaction dates you are looking for!
Its going to be the same routine for Balancing the Purchase Ledger and the Creditors Control. Once you are confident in balancing your ledgers, you’ll be running through this routine in no time, and the more often you are checking, the quicker you’ll be in finding in corrections and correcting them!
We do multiple reports that may help with your reconciliation process, keep an eye for our free reports of the month to see if you can spot one of these by signing up for our Sage 200 Buzz newsletter here.