What is bank reconciliation?
Bank reconciliation is the process of comparing the money movements that appear in your bank account with those you have recorded in your accounting system. The goal is to make sure everything matches and that there are no errors, omissions or incorrect transactions.
It is a fundamental step for keeping accurate accounts and avoiding problems with taxes or with your business. It also lets you quickly detect errors, or even fraud.
Why is bank reconciliation so important?
Bank reconciliation is essential for several reasons:
Verify that everything matches: it ensures there are no errors in your accounts.
Avoid surprises: it helps you detect transactions you don't recognize or that may be incorrect.
Comply with tax regulations: if everything is properly reconciled, it is easier to meet your tax and accounting obligations.
Make informed decisions: when you know where your money stands, you can make better decisions for your business.
At Holded, we help you make this process much easier and faster.
How to do bank reconciliation in Holded
In Holded, you can do bank reconciliation by following these steps:
Link your accounts. The first step is to connect your bank accounts to Holded. This way, all transactions are imported automatically and you save time.
Open the reconciler. Access it from the Treasury menu and review the transactions of one or several accounts at the same time, such as payments and collections.
Reconcile the transactions. Compare each bank transaction with your company's documents (invoices, payments or collections) to make sure everything is correct.
Use rules and automatic suggestions. Rules automatically reconcile repetitive or similar transactions, such as your subscription payments. Suggestions propose matches, which you can sort by confidence level. You can also accept several suggestions or rules at once.
Generate a report. Once the transactions are reconciled, you can keep a clear record of your reconciliation:
From Treasury > Accounts: download the statement of transactions of an account to get an Excel file with all the reconciled transactions.
From Treasury > Payments and collections: sort the list by "Reconciled" and export the data to Excel.
The reconciler
The reconciler shows, on the left, the synchronized or imported bank transactions and, on the right, the existing documents in Holded.
How to access it
Access the reconciler directly from the Treasury menu, without having to enter each account first. The reconciler is multi-account: you can review and reconcile the transactions of several accounts from a single view, without having to go in and out of each one.
At the top you will find several filters to narrow down the transactions shown:
Status: by default, Pending and partial transactions are shown. You can also choose:
Pending reconciliation, and within this option filter by All, With reconciliation suggestions, Matching rules or No suggestion.
Partially reconciled.
Reconciled, and within this option filter by All, With rules or With automatic rules.
Bank account: select the account whose transactions you want to review.
Date: by default, transactions from the Last 12 months are shown. You can choose predefined periods (Today, Yesterday, Last 7 days, Current month, Previous month, Current quarter, Previous quarter, Current year or Previous year), select a specific year, quarter or month from Years, Quarters or Months, or define your own date range with Custom.
Search: find a specific transaction by typing part of its description.
Next to the title you will also find the Find suggestions button, which shows how many reconciliation suggestions are available.
Options (settings icon): from here you can manage reconciliation rules with Create rule and View rules, and configure how the reconciler is displayed. For example, you can turn on Hide suggestions and rules to see the list without suggestions, or Multiple account selection to review transactions from several bank accounts at once.
Transactions list (left)
Shows the synchronized or imported bank transactions.
Each row includes:
Description: description assigned by the bank.
Date: day of the transaction. This date is the value date (the date on which the bank applies the amount to the transaction).
Amount: amount of the transaction, in green if it is a collection and in black if it is a payment.
Documents: shows the document suggested to reconcile the transaction or, if there is none, the text No suggestion.
Using the arrows in the list header you can change the order of the results: next to Transactions, they are sorted by value date; next to Documents, by the suggestion's confidence level.
You can tick the selection checkboxes to work with several transactions at once, and adjust how many are shown per page from the bottom of the list.
When you select a transaction, the reconciliation panel opens on the right. While none is selected, you will see the message No transaction selected.
Date of the generated entry in reconciliation
When a reconciled transaction is posted, the date of the generated accounting entry will by default be the accounting date, that is, the date of the transaction recorded on the bank statement.
If you need to, you can change this criterion in Settings > Accounting > Preferences > Reconciliation, where you can choose between two options:
Accounting date: the date of the transaction recorded on the bank statement.
Value date: the date on which the bank applies the amount to the transaction.
This way, you can choose which date to use to generate the accounting entries when you reconcile.
Documents in Holded (right)
Shows the existing documents in Holded, with filters by:
Document type:
Sales, and within this option filter by All, Sales invoice, Sales receipt or Sales credit note.
Purchases, and within this option filter by All, Purchase invoice, Purchase receipt or Purchase credit note.
Payroll, Remittances, Payments or Collections.
Date: adjust the time range. By default, documents from the Last 12 months are shown.
Search 🔍: find specific documents.
Reconciliation tools in Holded
Reconciliation rules: automatically reconcile repetitive transactions, such as monthly payments. Available on all plans (Trial, Plus and Basic: 15 rules; Standard: 50; Advanced: 100; Premium: unlimited).
Automatic suggestions: Holded proposes which transactions can be reconciled with which documents.
Manual reconciliation: if a transaction can't be reconciled automatically, link it manually to the right documents, such as invoices or payments.
Bank reconciliation is a key process for keeping your finances up to date and error-free. Start linking your bank account today and optimize your accounting.
Reconciler features
The Holded reconciler includes the following features:
Multi-account system
The reconciler lets you work with several accounts at once from a single view, without having to go in and out of each account individually.
Suggestions view
The suggestions panel has been redesigned and lets you sort suggestions by confidence level, so you can review the most reliable matches first. Holded proposes which transactions can be reconciled with which documents.
Accept suggestions and rules in bulk
You can accept several suggestions or rules at once, without having to approve them one by one.
Bulk unreconciling
You can unreconcile several transactions at once, including multiple reconciliations linked to the same transaction.
Create rules from already reconciled transactions
You can create rules directly from already reconciled transactions, and access the full list of rules from within the reconciler. Rules automatically reconcile repetitive transactions, such as monthly payments.
Reconcile transactions without an associated document
If a transaction has no associated document in Holded, or needs new information, you can resolve it from the reconciler itself. With Reconcile without document (formerly "Transfer") you can move the amount to another accounting account, or create a payment or an accounting entry. With New document you can generate a purchase, a sale, or a purchase or sales receipt.