This blog will help you gain a better understanding of how to reconcile sub ledgers to the General Ledger in Microsoft Dynamics NAV.
The reconciliation checks for each period sub ledger so that the balances of the General Ledger Accounts in general ledger match the balances of the assigned sub ledger accounts. For example, compare the balances of the Trade Debtors accounts in General Ledger against the balances of the assigned Customer in Receivable.
This process helps you find differences between sub-module (i.e. Receivable, Payable, Bank) and General Ledger. The General Ledger balance for the Receivable should agree with the total on the report generated from sub-module (i.e. Aged Accounts Receivable).
Normally, if you are posting everything through from the sub ledgers to the General Ledger, the balances should match without any issue.
What can cause the difference?
There are a few factors that can cause discrepancies between sub ledgers and the General Ledger Balances:
- Entries posted in the sub-ledger is adjusted/corrected at the General Ledger level
- Manual posting to the sub-ledger control account in General Ledger
Therefore, we suggest that you regularly review the General Ledger accounts to ensure the control account (account assigned in Posting Group such as Customer, Vendor, Bank, Fixed Asset and Inventory) does not allow Direct Posting to the G/L account.
What accounts should be reconciled?
The General Ledger account setup in Posting Group (i.e. Customer Posting Group, Vendor Posting Group, Bank Posting Group, Fixed Assets Posting Group and Inventory Posting) determines which general ledger account system posts the transaction. Therefore, the total value generated from the sub-module needs to match with the control account in General Ledger.
What reports should be used for reconciliation?
As part of the reconciliation process, we recommend that you run the following report for the reconciliation:
This post was written by Katrine Ng, Microsoft Dynamics NAV Consultant at EBS.
If you have out-dated business software that’s limited in its reporting and analytical capabilities – then you should to talk to EBS about a powerful business management software solution – Microsoft Dynamics NAV. To find out more about Microsoft Dynamics NAV and other Microsoft business management software solutions, please call Dick Preiss at EBS for an obligation free discussion on 1300 303 973.
Microsoft Dynamics NAV is global enterprise resource planning (ERP) software that helps more than 100,000 companies worldwide manage their accounting and finances, supply chain, and operations. Start with what you need now, and easily adapt as your business needs change. In the Microsoft cloud or on your servers—the choice is yours.
Evolution Business Systems (EBS) is a Microsoft Gold ERP Partner and business management software specialist that equips its clients with software designed to achieve their business goals. EBS offers a complete, fully featured, whole of business system that can meet their needs: Microsoft Dynamics NAV, Microsoft Office 365, Microsoft Dynamics CRM and Microsoft Power BI. It’s available for deployment on Microsoft’s own Cloud servers – Azure – and packaged at an affordable monthly subscription price. EBS works alongside its clients to understand their business and vision, and offer solutions to support these both now and into the future.
Subscribe here to get our free EBS monthly enewsletter to get valuable blog articles from EBS and the latest updates on the Microsoft Dynamics product suite.