Financial Process:

Internal Reconciliation
SAP Business One
Version 10.0

PUBLIC
Objectives

At the end of this topic, you will be able to:

 Utilize the process of internal reconciliation in G/L accounts and business partners

 Review system reconciliations

 Perform internal reconciliation (manual type)

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Agenda

 Internal Reconciliation
 Internal Reconciliation Definition
 System Reconciliations
 Full Reconciliation
 Partial Reconciliation
 User Reconciliation
 User Reconciliation Types
 Reconciliation Currency

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Business Scenario

 Internal Reconciliation Process

Debit Credit Debit Credit

 System Reconciliations Statuses:

 User Reconciliations Types:

 User Reconciliation Statuses:

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Business Scenario

 Internal Reconciliation Process

Debit Credit Debit Credit

 System Reconciliations Statuses:
 Full
 Partial

 User Reconciliations Types:

 User Reconciliation Statuses:

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Business Scenario

 Internal Reconciliation Process

Debit Credit Debit Credit

 System Reconciliations Statuses:
 Full
 Partial

 User Reconciliations Types:

 Manual
 Automatic  User Reconciliation Statuses:
 Semi-automatic

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Business Scenario

 Internal Reconciliation Process

Debit Credit Debit Credit

 System Reconciliations Statuses:
 Full
 Partial

 User Reconciliations Types:

 Manual
 Automatic  User Reconciliation Statuses:
 Semi-automatic  Full
 Partial

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 Reflection Question:
Internal Reconciliation Process

 When Maria looks at the vendor’s account balance, it reflects the advanced Outgoing Payment and the A/P
Invoice transactions.
 Then why is it important for Maria to reconcile the vendor master data internally?

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 Reflection Question:
Internal Reconciliation Process

 When Maria looks at the vendor’s account balance, it reflects the advanced Outgoing Payment and the A/P
Invoice transactions.
 Then why is it important for Maria to reconcile the vendor master data internally?

 The A/P Invoice should appear as closed for:

 The Outgoing Payment
 Reports as Aging and Doubtful debts

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Agenda

 Internal Reconciliation
 Internal Reconciliation Definition
 System Reconciliations
 Full Reconciliation
 Partial Reconciliation
 User Reconciliation
 User Reconciliation Types
 Reconciliation Currency

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Internal Reconciliation Definition

Internal Reconciliation:
Matching and clearing Debit Credit Debit Credit
open credit items
to open debit items
within an account.

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System Reconciliations

System Reconciliations Statuses:

Debit Credit Debit Credit
– Full
– Partial

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System Reconciliation - Full Reconciliation

1 2
Outgoing Payment based on an
A/P Invoice A/P Invoice (or invoices)

Debit Credit Debit Credit

Automatic Internal
Vendor 202 Bank
Reconciliation 202
in the Vendor Master Data
Account
Expense /
Clearing 202
Vendor 202
account 2

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System Reconciliation - Partial Reconciliation

1 2
Outgoing Payment based on an
A/P Invoice A/P Invoice (or invoices)

Debit Credit Debit Credit

Vendor 202 Automatic Internal Bank Account 100

Reconciliation
Expense / in the Vendor
Clearing 202 Master Data Vendor 100
account
Balance Due: Credit = 102 2
Balance Due in the Vendors Liabilities Aging
Report
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System Reconciliation of Interim Accounts

Allocation account Good Receipt PO A/P Invoice

Credited Debited

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Agenda

 Internal Reconciliation
 Internal Reconciliation Definition
 System Reconciliations
 Full Reconciliation
 Partial Reconciliation
 User Reconciliation
 User Reconciliation Types
 Reconciliation Currency

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User Reconciliation – Manual Type

Business Partner Account

In this example, Customer Master Data
Selected Origin Posting Date Amount Balance Due Amount to Reconcile

 IN 10.07 1000.00 1000.00 1000.00

 IN 17.08 2000.00 2000.00 1500.00

 RC 24.08 (1000.00) (1000.00) (1000.00)

 RC 24.08 (1500.00) (1500.00) (1500.00)

 IN 01.09 3000.00 3000.00

0.00

Manual Internal Reconciliation in the Customer Master Data

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User Reconciliation Types

 User reconciliation types:

 Manual
 Automatic Debit Credit Debit Credit
 Semi-automatic

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Multiple Business Partner Reconciliation

A Connected
Business Partner

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Multiple Business Partner Reconciliation – Journal Entry

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Reconciliation Currency

BP Currency

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Balancing Transactions in Internal Reconciliation

When reconciling, the system checks for: The system automatically creates:

 An exchange rate difference

 A difference in the local currency
journal entry
when a foreign currency is involved
(in LC and SC)

 A difference in the system currency

 A conversion difference journal entry
when the company’s local currency
(in SC only)
is different from the system currency

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Unique Identifiers

Debit Credit Debit Credit

 Unique identifier for internal reconciliations:

 User Reconciliations:
Manual, Automatic, or Semi-automatic
 System Reconciliations

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Manage Previous Reconciliations

Account
Cancel User
2000 5000
Reconciliation
3000 2000
Account

2000 5000
3000 2000

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Summary (1/2)

Here are some key points:

The term, Internal reconciliation, refers to: • The matching and clearing of open credit items to
open debit items within an account (therefore
internal).

For vendor accounts: • A liability (credit) is reconciled with an outgoing

payment (debit).

Internal reconciliation can be: • System reconciliation.

• User reconciliation.

The statuses of both, the system Reconciliation and • Full

the user reconciliation are: • Partial

User reconciliation types: • Manual (with the Multiple BPs option)

• Automatic
• Semi-automatic
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Summary (2/2)

An internal reconciliation is performed in one currency: • Local currency (BP/ Account = local currency or all
currencies)
• Foreign currency (BP/ Account = Foreign currency
)

SAP Business One can handle accounting in two parallel • The local currency.
currencies: • And the system currency.

All internal reconciliations (system and user) need to • The local currency.
balance in: • And the system currency.

The system assigns a unique reconciliation number to • System reconciliation.

each internal reconciliation for both: • User reconciliation.

The Manage Previous Reconciliations function allows • Review or cancel a user reconciliation.
you to:

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