Cash reconciliation

Cash Specialist records the client receipt with its provider event reference, amount and received date. Verification establishes which money is ready to apply. The application then identifies the receipt, accounting document and amount being matched. Keeping those records separate lets the team explain a partial payment or cash that still needs a matching decision.

An architecture client may pay several design fees together or send less than the full amount of an invoice. Start from the verified receipt and the intended client document. Finance Manager can compare the receipt total, active applications and remaining invoice amount without treating all money received from a client as settlement of a particular charge.

• Verify the receipt. Cash Specialist checks the provider event reference and amount against bank or payment evidence. Confirm the business partner before marking the receipt verified. Investigate an uncertain source result before allocating the money.
• Apply the amount. Select the intended fee document and record the applied amount and date. Compare it with the available receipt and invoice amount. Keep unapplied cash available for later matching when the client’s remittance advice is incomplete.
• Reconcile corrections. If an application is unwound, retain its reversal date and compare the released amount with the receipt balance. Finance Manager checks the resulting document and ledger position before the period is closed.

Bring a bank receipt example, a client remittance and an open invoice. Agree which external confirmation establishes verified cash and how the provider reference is retained. Define the matching rules for client identity and the review needed when the remittance differs from the invoice amount.

Set up any bank or payment-provider connection separately. Rehearse repeated delivery of the same event and an interrupted application. Agree who investigates uncertain outcomes and how the existing operation is found. Decide how credits are reviewed alongside invoice balances so an unrelated credit is not silently treated as cash on a particular invoice.

Use a rehearsal design invoice for USD 8,000 and a verified receipt of USD 5,000. Cash Specialist applies the receipt to that document. The invoice cash application balance is USD 3,000, while the receipt has no remaining amount to allocate. Finance Manager checks both results against the original records.

Next, receive USD 4,000 for the same client. Apply USD 3,000 to the invoice and retain USD 1,000 as unapplied cash until its purpose is agreed. The client may intend it for another fee; keep that decision separate from the invoice already covered. Ask Cash Specialist to explain both the invoice position and the unused receipt amount.

Repeat the receipt notification with the same provider event reference. Reconcile it to the earlier receipt before proceeding. Finally, unwind an incorrect application and confirm that its dated history remains available and the released amount is reflected in the reconciliation.

• Verified cash receipts — Verified receipts with their client and amount, including money already fully applied.
• Cash application history — Applied amounts with the document, receipt and any reversal date.
• Posted fee documents — Posted client documents available for checking the application target.

Follow verified cash to reconciliation and revisit journal review to posting when an application changes the period reconciliation.