Automate the processing of bank statements
Assign bank lines
In this article, we give tips on how to automate the processing of bank statements as much as possible. Basically, this is independent of which module you use.
In Twinfield we have two modules, the new Banking module and the Classic Electronic bank statements.
Note: We recommend using the new Banking module as much as possible.
How does the automatic recognition of invoices in the bank statements work?
Twinfield will be the first to try to find a customer or supplier. To make this possible, the presence of the IBAN account number on the master data of the contact is a requirement. If a payment appears on the bank statement in which the relevant IBAN number is used, Twinfield will automatically link the payment to the relevant customer or supplier. There is no alignment in this step yet.
In the next step, Twinfield will try to automatically link the bank statement lines to invoices (reconciling). If an invoice number is mentioned in the description, Twinfield will check whether it appears on the open list of items. If this is the case, then it will be checked whether the amount of the bank statement line matches the outstanding invoice amount. If this is the case, Twinfield will automatically reconcile the bank statement line against the invoice. If the outstanding amount differs, Twinfield will not automatically reconcile.
Good to know: in the new banking module, the IBAN account number of the counterparty is automatically added to the master data of the customer or supplier. This feature is only available to users who are allowed to maintain master data. In addition, no account numbers will be deleted.
Make sure that all invoices are booked before a bank statement is read
The moment a bank statement is read, Twinfield will automatically start the recognition. Twinfield can only recognize invoices that have already been booked. So make sure that all invoices are booked before a bank statement has been read, otherwise the recognition will not work optimally.
The moment a purchase or sales invoice is booked after the bank statement has been read, Twinfield will also automatically try to recognize it. It is also possible to manually start the automatic recognition again at any time. This Apply Rules feature can be found under the Bank Statements tile.
Prevent invoices from being paid via a manual transfer
Try to prevent customers from manually transferring invoices. Manual transfer is human work and this entails error sensitivity. Typing errors in the invoice number or the amount during manual transfer mean that the automatic recognition in Twinfield does not function optimally.
Ideally, offer customers the opportunity to:
- Easy to pay via a payment provider such as iDeal
- Invoices to be paid via the SEPA batch payment
- Collect invoices by direct debit
Payments initiated through one of the above options can often be processed fully automatically by the unique payment credentials that are created in the background in this process.
Via the Payment & Collection module in Twinfield, you can easily control the payment and collection process for your customers. If a bank link is used, the batch file can often also be sent to the bank via the bank link. The account holder then authorizes the file from the bank.
For more information, please visit: Payment & Collection
If customers do manually transfer payments, make it as easy as possible for them
Always ask customers to include the invoice number in the description of the transfer. Make it easy for customers and avoid complicated invoice numbers like ABC-234-4828. Letters can be swapped and dashes can become different characters. For example, customers can quickly make the mistake of writing ABC-234-4828 as ACB 234/4828. An invoice number such as 2344828 is less likely to be misspelled.
Try to avoid partial payments
Twinfield is usually unable to automatically recognize and reconcile partial payments in a manual transfer. This is because the partially paid amount is usually not equal to the outstanding invoice amount.
You could possibly split a collective invoice into several invoices, each with its own unique invoice number. In this way, Twinfield can recognize partial payments if the amount paid corresponds to the outstanding invoice amount.
Enter the IBAN numbers for as many customers and suppliers as possible
If the IBAN numbers have been entered for the relations, Twinfield can already indicate in the bank statement module which customer or supplier it concerns.
Make use of a bank booking instruction
Suppose you pay bank charges on a monthly basis and that the description bank charges is always mentioned. In this case, you could record an entry instruction that stipulates that this must always be booked on a certain ledger account.
When using the bank entry instructions, it is essential that these instructions are also maintained so that the assignment is correct. In the event that a bank booking instruction is no longer correct, we recommend that you adjust the instruction immediately. Alternatively, a new bank posting instruction can also be created for the same allocation. The original instruction must then be removed so that no duplicate is created. For more information on how to use and manage the bank booking instructions, see also: Banking module - Bank booking instructions
Note: Do not record booking instructions on IBAN numbers for reconciling purchase and sales invoices. The reconciliation of invoices can best be automated by means of the master data. You would only record a booking instruction on an IBAN number if, for example, you always want to book on a ledger account when paying from a certain IBAN number.