Automated Bank Reconciliation
Most organizations still rely on balancing their spreadsheets with a highlighter, cautiously marking as they go along. When it comes to reconciling bank accounts, they do the same. For anyone that’s performed a bank reconciliation, you’re all too familiar with how grueling the process is.
Don’t get me wrong, reconciliations are both beneficial and necessary. However, look at it from this standpoint: on the one hand, you balance your accounts. That’s good. On the other hand, money is spent doing it. Since most organizations reconcile once a month, that cash adds up.
It sounds counterintuitive.
In the past year, businesses and nonprofits have been turning to automated forms of banking. The rise is due to many of them seeking alternative ways to save time and money. Automated reconciliations help by matching the records of your bank account with your bank statement. This avoids all the manual labor of entering them into multiple spreadsheets. What once took hours, now takes minutes.
With so many organizations looking to switch, here are a couple reasons why you should consider automated reconciliations as well.
REDUCE POTENTIAL RISK
As your sales continue to grow, the more complex your financials get. In turn, you need to prepare yourself. There’s a spectrum of errors waiting to hit your books. Banks don’t typically cover for errors, so it’s crucial to catch them beforehand. Some of these errors include:
- uncleared checks that haven’t been presented
- outstanding checks that vendors haven’t deposited
- missed withdrawals and deposits
Some companies won’t blink twice over small-scale inconsistencies. Larger non-profits might not either. If ten dollars is missing, it won’t pose a problem. It’s not worth the time. But, ten dollars could represent any one of these errors. The worst-case scenario is it’s an indicator of fraud. Over time, that could snowball into something massive.
Not all of us have time for minute details. With an automated system you can retrace a questionable transaction with ease. This provides you with the needed time to identify and tackle these issues, like fraud, beforehand. You can rid yourself of potential risk while maintaining balance of your accounts.
More than half of a financial department’s efforts are wasted on already matched transactions. That’s a lot of drained expense on nothing. At that point, you’re not even resolving discrepancies. You’re just killing time.
With an automated system, transactions are automatically matched with your bank account, reducing time spent going line by line. With so much time freed up, your productivity will increase.
That equals less time reconciling and more time advocating. If you’re a nonprofit, you now have the capability of advancing your mission even further. That means allocating your funds to more charitable causes. Increasing your events. Connecting more with the community.
WITH THAT SAID…
Reconciling your bank accounts is imperative. Using an automated method benefits you from all the headaches caused by a such a meticulous process. Time is of the essence, as they say. So don’t waste your time. With automated bank reconciliation, you gain back those precious hours.
Cougar Mountain Software is the creator of Denali Fund, a complete accounting solution specifically designed for nonprofits. With the new rollout of Denali 9.2, Cougar Mountain Software now offers automated bank reconciliation. To learn more, contact us at (800) 388-3038 or email@example.com.Make sure to check out our blogs about our newest add-on, Denali BI, Powered by Sisense, and our recent partnership with NeonCRM donor and grant management software.