Product documentation
After the lines have been imported and split, the reconciliation can be started via [Functions, Reconciliation]. Per line, the system searches through the open invoices of the identified customer or vendor and tries to find invoices based on the invoice number(s) in the field Note, and the invoice amount(s). For lines of type 'Ledger' it tries to find the correct ledger account and financial dimensions.
Dynamics Banking supports 7 main reconciliation scenarios:
1. Customer payment is settled against one or more invoices
2. Customer direct debit is settled against a bridging transaction
3. Customer direct debit is cancelled, and the customer invoice(s) are reopened
4. Vendor payment is settled against one or more invoices
5. Vendor payment is settled against a bridging transaction
6. Vendor payment is settled against a bridging transaction - batch
7. Transactions get assigned to a ledger account and financial dimensions
Depending on the result a color indicator will appear in the grid:
|
|
Customer |
Invoice number |
Amount |
Discount |
Match |
 |
= or X |
X |
X |
|
No |
 |
= |
= |
X |
|
User decides |
 |
= |
multiple |
= |
= |
User decides |
 |
= |
=[Note1] |
= |
after cash |
User decides |
 |
= |
=[Note1] |
= |
= |
Automatic |
If the system could make a green match, the found invoices are settled with the bank transaction.
If the icon is white, no customer or vendor has been found, or the reconcile function has not been executed yet.
Note
Filter
On the top the color codes filters can be switched on. Standard, all colors are active, so all records are shown. By switching off green and white, the user can focus on the exceptions, i.e. the bank transactions that are not matched completely with invoices.
Adjust invoice data
In some cases, the information sent on the bank account statement, is incorrect or incomplete. Invoice numbers may be abbreviated, or mistyped in the customer’s administrative system. On the payment tab, the field Note is filled with the payment reference that was specified by the customer.
Invoices are found based on information in this field. The way this field is interpreted, can be defined in the bank reconciliation settings. If the data is not correct, the user can change this field and choose manually [Functions, Settlement]. This functionality can also be helpful, if a user just wants to test the reconciliation, and not the import.
Iterations
The function Settlement can be used as many times as necessary. Green lines remain green, and other lines may get a new status and color if the information from the bank account statement is corrected or adjusted.
Settlement
If the match is green, the system will automatically settle the open transaction. If the user chooses [Functions, Settlement] again, the system will ask: Marked transactions exist. Remove them? Normally you will want to keep the already settled transactions, so the answer should be No. In the next screen, the user can define what lines to mark in the column Mark.
Manual settlement
In some situations, open transactions must be settled against payments manually. Therefore, the user can manually set a line to green. When the settlement screen is closing, and open transactions are marked, the user is asked whether the according bank transaction line should be switched to green (regardless the previous color). If the user denies, the line gets color white (regardless the previous color).
Manual Acceptance
If, for some reason the system did not set a line to green, but the user is convinced the data is correct, they can make the line green by clicking the 'Accept' button.
Manual Reset
The user can reset a green line (settled) to the white (unsettled), if a correction needs to be made. Use the button 'Undo' for this.
Note
Tracing log
The tracing log functionality has been added to the Banking Journal to help the user understand why Microsoft Dynamics 365 for Finance and Operations found (or did not find) a customer, vendor or invoice. The logging can be activated in the Bank Reconciliation setup.
When 'Infolog' is selected, an infolog will appear in the journal after the reconciliation is run. When 'Table' is selected, the reconciliation log is available in the Journal Lines button Dynamics Banking log.
Ledger lines
If bank transaction lines have type ‘Ledger’, and the ledger account is filled, the Settlement function will put these lines to green.
Not all bank transactions refer to a customer or vendor. The solution also provides the possibility to define payment terminals.
These terminals are linked to ledger accounts, and on importing the bank statement the system will search for substrings referring to terminals and create lines against pre-defined ledger accounts.
This functionality can be used if you want the system to use a ledger account, based on a fixed description, like a POS-id, payment terminal, or any other standardized bank transaction (interest, banking fees, etc).
On import of a bank statement (Import Account Statement (Transactions), the system compares the substring of the line identified with ":86" to the Payment Terminal table. If there is a match against a Payment terminal number, the system will create a line in the journal using the segmented entry as specified in field ‘Account’.
Example:
A Dutch MT940 file would hold information regarding the payment terminals:
In the payment terminal form one would link codes 0QB903, 634C03, 1H34MD, T775BT, S6TH9G, and 9GGJ1X to their respective ledger accounts.
As of release 1007.31.620, this functionality not only allows the specification of ledger accounts, but also of vendor and customers.
The last step in the process is posting the journal. The system will check the parameter All lines must be green on the journal header. If enabled, the journal can only be posted when all lines are marked green.
In case of a split journal all journals will be validated and posted together.
Occasionally, fully paid invoices have a small balance due to e.g. currency fluctuations. If the open amount of an invoice does not correspond with the amount in the grid, standard Microsoft Dynamics 365 for Finance and Operations asks the user if the amount in the grid needs to be adjusted. Usually, that is not desired. In Dynamics Banking, the user is asked the same question, but if answered positively, the difference in amount is put in a new line of the grid, making it easy for the user to post it to a ledger account.
Example:
The imported bank statement line has a value of 100,-. The user manually settles the line against an open invoice of 98,-. Microsoft Dynamics 365 for Finance and Operations recognizes a difference of 2,- and will ask the user if they want the system to adjust the amount of the journal line. If the user answers ‘Yes’, a new journal line is created for 2,- and the original line is changed to 98,-. If the user answers ‘No’, nothing happens to the journal line, and the amount stays 100,-
As of release 10020.44.730.26272 fields are present for the original invoice currency and the (cross)rate used by the bank. And during reconciliation, those values used to set the amount and settle the invoice.
For CAMT053 fields <SrcCcy> and <XchgRate> are taken from section <AmtDtls> As of release 10020.44.730.26272 fields are present for the original invoice currency and the (cross)rate used by the bank. And during reconciliation, those values used to set the amount and settle the invoice.
For CAMT053 fields <SrcCcy> and <XchgRate> are taken from section <AmtDtls>
General ledger > Ledger Setup > Bank reconciliation > tab: Company recognition
As of release 10020.44.730.26272 there is new tabpage in the set-up that maps invoice-formats to companies. E.g. INV-###### would map to company DEMF and FAC-###### would map to FSRI. After importing the Bank Statement, a routine ‘recognize company’ is called, and using the invoice format in the payment note, it determines the original company of the invoice. The company on the journal line is replaced with this original company of the invoice.
The ‘Reconcile’ routine now uses the company from the journal line to find invoices in that company and the invoice is settled in the original company. On posting the journal, Dynamics processes everything and creates 2 journals (one in the current company, and one in the original company of the invoice)
The system uses the grace period of the method of payment (as identified on the open invoice), when determining if customer cash discounts were properly taken. The grace period is added to the cash date on the open invoice. If the payment date is within this calculated date, the system will flag the line as green. Otherwise it will flag the line as cyan.
Example:
If no open transactions are marked during manual settlement, the user is not prompted if the green color should be set. A workaround would be, to manually mark a transaction for settlement, confirming that the record should be marked green, and afterwards unmark the transaction again.