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What is the Accounting Workflow for Reconciliation?

By
Stephen Mate
on 2/12/15, 10:39 AM 2,099 views

Odoo handles reconciliation in an unexpected manner for me, and I'm not the only one. Here are others that have the same problem:

UserV has the same problem:https://www.odoo.com/forum/help-1/question/bank-statement-reconciliation-with-paid-bank-journals-73641

Kevin has the same problem: https://www.odoo.com/forum/help-1/question/bank-statement-reconciliation-functionality-73101

Cameron has the same problem: https://www.odoo.com/forum/help-1/question/what-is-reconciliation-in-openerp-12151

Odoo has a lot of reconciliation capability, so I imagine there can be an explanation. 

My expectation: We receive a supplier invoice, and validate it. We then use the accounts aging report ("Aged Partner Balance") to determine which invoices require payment. We then pay the invoice, and record the payment in Odoo, moving the invoice to the 'Paid' state . At the end of the month, we then reconcile from the bank or credit card statement, to confirm, for example, that the check has been cashed. Reconciling itself does not create accounting entries (simply marks the existing entries as reconciled). 

Odoo Behaviour: The act of reconciling in Odoo creates journals entires. And only the "Unpaid" invoices are available to be reconciled. 

What is the correct workflow?: How is everyone managing this? I don't think it's acceptable to wait until the end of the month to mark the invoices of paid, as the paid invoices needs to be tracked as they occur. Is there a setting to prevent reconciling from moving the invoices from Open to Paid? Is it really necessary to install a module as Kevin pointed out ('Bank and Cash Statement with Vouchers'), as this cannot be done on the SaaS version? I am hoping there is one most correct workflow for this fundamental accounting process, and that is accomplished by Odoo without modules and tweaking. 

Workaround: What I am also wondering, is it the case that in North America, reconciliation has a different definition then other countries? The workaround I am considering is to not use Odoo's reconcilation functionality, and manually 'reconcile' the bank statement lines items with the journal entries. I accomplish this by storing the bank line item in Excel, and opening the "Journal Items" report in Odoo, and checking them off as reconciled in Excel. 

Cheers, Steve

 

Thanks Ray! Ok, let me work through some more specifics given these clarifications!

Stephen Mate
on 2/12/15, 1:59 PM
4

Ray Carnes

--Ray Carnes--
15717
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Greater Los Angeles, United States
--Ray Carnes--

Senior Odoo Analyst

OpenERP 6.1, 7.0 and Odoo 8.0, 9.0 (Since 2012)

Completed Functional and Technical Training.

Major Skills:

  • Needs Discovery and Requirements Analysis;

  • Function and Technical Specifications;

  • Project Planning;

  • Prototyping and Proof of concepts;

  • Data migration;

  • Configuration & Customization (UI and modules);

  • Integration - data, business logic and service levels;

  • Training and Knowledge transfer;

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  • Help desk;

  • Version Migration.

I have over 20 years of experience empowering and enabling users with enterprise information systems that make a real and measurable difference in their ability to proactively manage their businesses and organizations. 

Ray Carnes
On 2/12/15, 1:49 PM

(Un)Reconcile in Odoo has several meanings.

WHEN APPLIED TO JOURNAL ENTRIES USED AS CORRECTIONS:

To ‘reconcile’ a journal entry is to match it with a cancelling entry.

WHEN APPLIED TO PAYMENTS:

To ‘unreconcile’ a payment is to unpost it, and to remove any relationship it may have with an invoice that is has been applied to.

WHEN APPLIED TO INVOICES AND PAYMENTS:

To ‘reconcile’ a payment to an invoice is simply to apply part or all of the payment balance to the invoice balance, reducing or closing the invoice.

Normally invoice/payment reconciliation is taken care of automatically.  If for example you recorded a payment before an invoice was created, you may need to manually reconcile the two (unless you record a $0 payment that applies the payment balance to the invoice balance).  The Accounting --> Periodic Processing --> Reconciliation menu takes care of this type of reconciliation.  

 

WHEN APPLIED TO BANK STATEMENTS:

To ‘reconcile’ a bank statement is to match it against the transactions in Odoo, potentially adding transactions like bank fees that won’t be in Odoo.

A better module to do bank reconcilation is at https://www.odoo.com/apps/modules/7.0/npg_bank_account_reconciliation/

The Accounting --> Bank and Cash --> Reconcile Bank Account and Statement menu is where you create a new bank statement.  It is very similar to how Quickbooks works.

 

To your specific question, it works as you expect. Your next question might be where in the specific workflow you are not seeing what you want to see.

Ray, the description of the module "npg_bank_account_reconciliation" is interesting, however it may not be possible to install it on the V8 SaaS version.

Stephen Mate
on 2/12/15, 2:31 PM

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Asked: 2/12/15, 10:39 AM
Seen: 2099 times
Last updated: 11/2/16, 7:39 AM