Bank & Subledger Reconciliations

The Reconciliations module verifies that General Ledger account balances accurately reflect cash reality in bank accounts and continuously audits mathematical parity across operational subledgers.

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The 5 Continuous Subledger Parity Proofs

HeroBM runs 5 real-time parity checks across the financial subledgers to guarantee that operational documents (orders, shipments, receipts, bills) reconcile with the General Ledger:

flowchart TD
    GL[General Ledger Core] --> P1[1. Trial Balance Zero-Sum]
    GL --> P2[2. Accounts Receivable Parity]
    GL --> P3[3. Accounts Payable Parity]
    GL --> P4[4. GRNI Accrual Clearing Parity]
    GL --> P5[5. Perpetual Inventory Asset Parity]

1. Trial Balance Zero-Sum Proof

Ensures all posted journal lines are mathematically balanced:

Drift = abs(Sum(Debits) - Sum(Credits)) <= 0.005

2. Accounts Receivable (AR) Subledger Parity

Verifies the AR Control Account matches the sum of individual customer open balances:

Drift = abs(GL_AR_Control_Balance - Sum(Customer Open Invoices - Customer Unallocated Credits)) <= 0.005

3. Accounts Payable (AP) Subledger Parity

Verifies the AP Control Account matches the sum of individual supplier open liabilities:

Drift = abs(GL_AP_Control_Balance - Sum(Supplier Open Bills - Supplier Unallocated Debits)) <= 0.005

4. GRNI Clearing Accrual Parity

Audits the temporary clearing account for received items awaiting supplier invoices:

Drift = abs(GL_GRNI_Clearing_Balance - Sum(Received Unbilled PO Line Quantities * Receipt Unit Cost)) <= 0.005

5. Perpetual Inventory Valuation Parity

Ensures capitalized inventory assets match live warehouse bin quantities multiplied by unit moving WAC:

Drift = abs(GL_Inventory_Asset_Balance - Sum(Product Bin On-Hand * Product WAC Cost)) <= 0.005

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Bank Reconciliation Matching Engine

flowchart TD
    A[Import Bank Statement CSV / OFX] --> B[Matching Rules Engine]
    B -- Exact Match --> C[Auto-Reconcile Payment]
    B -- Rule Pattern Match --> D[Auto-Generate Bank Fee / Interest Entry]
    B -- Unmatched --> E[Manual Match / Split Allocation]
    C & D & E --> F{Difference == 0.00?}
    F -- Yes --> G[Sign Off & Lock Statement]
    F -- No --> H[Review Unmatched Transactions]

1. Automated Matching Rules

Configurable rule profiles (/reconciliations/rules) evaluate incoming feed lines:

• Reference & Amount Match: Automatically matches transactions where the bank reference contains the invoice number and amounts match exactly within date tolerance.
• Recurring Bank Fees & Interest: Automatically creates journal entries to designated expense accounts for banking charges without manual intervention.

2. Sign-Off & Audit Locking

When the statement ending balance matches the ledger balance (Difference = 0.00), clicking Sign Off permanently locks the reconciliation record and timestamps all matched ledger lines.

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Step-by-Step Workflows

1. Reconciling a Bank Statement

1. Go to Finance → Bank Rec’n → Statements (/reconciliations).
2. Click Import Statement (/reconciliations/new) and upload the bank CSV or OFX statement.
3. Review the side-by-side matching grid:
   • Left side: Imported bank statement feed lines.
   • Right side: Open GL payments, deposits, and receipts.
4. Click Auto-Match to process exact matches.
5. For remaining items, manually select matching ledger records or click Create Entry for ad-hoc charges.
6. Verify that the Difference is 0.00.
7. Click Sign Off Reconciliation.

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Field Reference

Field	Description
Bank Account	Reconciled General Ledger bank account.
Statement Ending Balance	Closing balance from official bank statement.
GL Ledger Balance	Sum of all posted cash transactions in HeroBM.
Variance / Difference	Unreconciled gap (must reach 0.00 for sign-off).