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Vendor Account Group to Reconciliation A/C Mapping

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Hi All,

I am implementing Accounts Payable and I need some recommendation on what is the best practice of mapping Account Group to Reconciliation and why?

in As is

In current system they have N Vendor Account Groups mapped to one Recon Account. There a lot of manual reconciliation they do in current system.

I see The fields which should be controlled at Account Group like Jurisdiction Code are controlled through Custom enhancements.

Regards,

Peenakshi

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Answers (1)

Answers (1)

sanilbhandari
Product and Topic Expert
Product and Topic Expert
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Hi s.peenakshi

There is no one fit all practice to map recon account to Vendor Account groups. It is best dependent on your reporting requirements for the financial statements as well as how you want to see the liabilities shown in the reports.

I have seen many customers classify their vendor recon accounts based on:

1) Trade Supplier - Domestic

2) Trade Suppliers - Foreign

3) Affiliated Companies

In many countries it is a reporting requirement to classify current liabilities according to their origin, so they create seperate recon accounts for domestic and foreign suppliers. It is also a good practice to show affiliated companies as seperate recon account especially if you have a group of companies, since at a group level these liabilities should already be paid off.

In addition, to above, one should also have recon accounts for balance reclassification such as:

1) Advances paid to suppliers - This would be shown as a current asset

2) Debit Balances on Suppliers - This would also be shown as current asset on balance sheet

In some countries there are further reclassification requirements such as liabilities more than 1 year and less than 1 year, so you might also have to create such recon accounts, depending on your reporting requirements.

Thanks & Regards

Sanil Bhandari