Accounts Reconciliation Blog

To come up with a positive income statement, you have to make sure that all of your accounts are well managed. It is important that aging of accounts receivables are properly monitored and that accounts payable are duly accounted for. Your staff in charge should therefore be very knowledgeable on how to reconcile accounts payable. This can minimize penalties (for past due) and can help you establish a good relationship with your suppliers or creditors.
Here is a simple guide on how to reconcile accounts payable:

~Prepare a general ledger stating the sum of all accounts payable and a subsidiary ledger that contains details of each item. Balances of both should be equal.
~Reconcile accounts using a spreadsheet – Column A for the general ledger and Column B for the subsidiary ledger. Again, these two columns should be balance
~Items in subsidiary ledger should be reviewed and check if something was not registered in the general ledger
~Look for possible recording errors or mispostings
~Close the books by making adjusting entries depending on company policy. Some will not allow closure of the account if left unreconciled.