How to Perform Bank Account Reconciliation in Business Central?

Bank reconciliation is a critical but tedious and time-consuming process of comparing a company’s cash balance on its balance sheet with the corresponding amount on its bank statement.

In simple terms, it compares the transactions recorded in a company’s accounting records with those on the bank statement.

The goal is to ensure that the company’s records match the bank’s records and identify any discrepancies that may exist. Maintaining the accuracy of financial statements and resolving the missing payments can be quite a challenging and time-consuming process.

This is where Microsoft Dynamics 365 Business Central comes into play. The module of bank reconciliation in Dynamics 365 Business Central simplifies this process.

Dynamics 365 Business Central is a prominent ERP software that facilitates bank reconciliation with its wide range of features, user-friendly interface, and efficient tools. It efficiently eliminates bookkeeping discrepancies and streamlines the financial management of your company.

In this blog post, we will illustrate how you can set up bank account reconciliation in Business Central and how you can use it to gain maximum benefits.

Why Choose Microsoft Dynamics 365 Business Central for Bank Reconciliation?

Microsoft Dynamics Business Central offers robust features for bank reconciliation, making it an excellent choice for businesses. Here are some reasons why you might consider using it:

Efficiency and Accuracy

Business Central streamlines the reconciliation process by comparing and matching entries in your bank accounts with transactions from your bank. This ensures accuracy and reduces manual effort.

User-friendly Interface

The platform provides a user-friendly interface for reconciling bank accounts. You can easily navigate to the relevant sections and input the necessary information.

Comprehensive Reconciliation Options

Business Central allows the automatic matching of transactions with bank entries. You can use the “Match Automatically” action to reconcile transactions efficiently.

AI-Powered Reconciliation Assist

As part of the bank reconciliation assist feature, an AI-powered “Reconcile with Copilot” action is available. This assists in matching transactions intelligently.

Manual Matching

If needed, you can manually select lines in both panes (bank statement lines and bank account ledger entries) to link them and then use the “Match Manually” action.

Financial Visibility

Reconciliation ensures that your books align with the statements received from your bank. By posting reconciled balances to your bank accounts in Business Central, you provide accurate financial data for finance managers.

Error Detection

Bank reconciliation helps identify missing payments and bookkeeping errors. It’s a practical way to maintain financial integrity.

How to Perform Bank Reconciliation in Dynamics 365 Business Central?

When it comes to reconciliation, the process of matching is crucial. It entails matching and verifying transactions from your bank statements with bank entries in Business Central. There are three ways to do it:

1. Match Automatically action

2. Reconcile with Copilot action

3. Selecting lines manually in both panes using the Match Manually action

Get in touch with Dynamics Square, your Dynamics 365 implementation partner, for bank reconciliation-related or any assistance. Book a free consultation now!

Here, we have mentioned the steps for bank reconciliation using Copilot:

1. Go to Bank Account Reconciliations

• Select the Bank Account Reconciliations icon or enter “Bank Account Reconciliations” in the search bar.
• Choose the related link to open the reconciliation window.

2. Open the Reconcile with Copilot Action

• In the reconciliation window, select the Reconcile with Copilot action. This will open the Reconcile with Copilot window.

Note: Pre-Requisite: Navigate to the 'Copilot & AI capabilities' page on Business Central and enable the functionality according to the below screenshot.

3. Select the Bank Account

• Set the Perform reconciliation for this bank account field to the specific bank account that you want to reconcile.

4. Import Bank Statement (if needed)

• If the selected bank account isn’t linked to an online bank account, you’ll need to import the bank statement file manually.

5. Review Suggestions and Matches

• Copilot will automatically provide suggestions for unmatched transactions.
• Review the suggestions and matches carefully.

6. Accept, Reject, or Modify Suggestions

Based on Copilot’s recommendations, you can:

• Accept a suggestion if it’s accurate.
• Reject a suggestion if it’s incorrect.
• Modify a suggestion if adjustments are needed.

7. Post the Reconciliation

• Once you’ve reviewed and adjusted the suggestions, post the reconciliation to finalize the process.

To see the bank reconciliation process in action, check out this video:

Remember to verify the accuracy of the reconciled transactions before posting. Copilot aims to streamline the reconciliation process by providing intelligent suggestions, but human oversight is essential.

How to Get the Print of Bank Reconciliation Details via Business Central?

In case you don’t experience any discrepancy, you may find the need to take a print of your bank reconciliation via Business Central. Interestingly, Business Central includes print options that can be further easily customized as per your requirements and preferences.

You can follow the below steps to get the print of bank account reconciliation reports:

• Select the appropriate bank account by navigating to the core interface of Business Central.
• Choose “Bank account reconciliation” by clicking on the magnifying glass icon. A result window will pop up to show a link.
• Then get to the “Test report” option.

You will find a menu that will let you print your report as per the different options available there.

Then, click on Print to find a comprehensive statement of your bank operations. These operations may include the following options:

• Printing Details
• Printing of Checks
• Printing of pending checks
• Printing of deposits
• Printing of current deposits
• Print settings

How Can Dynamics Square Help You with Bank Account Reconciliation with Business Central?

We, at Dynamics Square, totally understand that bank account reconciliation is a complex process, but you don’t need to worry about it at all. We have the required expertise to make your bank account reconciliation a smooth and successful journey.

Dynamics Square is a well-received Microsoft Dynamics partner with a team of more than 150 experts for extensive support and guidance tailored to your specific requirements.

In summary, bank account reconciliation in Business Central is a crucial process that ensures financial accuracy and helps identify discrepancies. By matching bank transactions with ledger entries, businesses can maintain reliable financial records and make informed decisions.

Remember, reconciling your bank accounts isn’t just about balancing numbers—it’s about maintaining financial integrity. With Business Central’s features, you can streamline this process and gain confidence in your financial data.

Dynamics Square is a renowned Dynamics 365 implementation partner with over a decade of experience in successfully deploying Microsoft solutions. In case any assistance is required, feel free to call us directly at +1 281 899 0865 or simply write an email at arish.siddiqui@dynamicssquare.com.