In this Fast Class, we review changes to the bank reconciliation process in Business Central. Beginning with the October 2023 release, Microsoft's newer bank reconciliation functionality became standard and can no longer be reverted to the legacy process. This session demonstrates how to complete a standard bank reconciliation using the updated experience.

What changed in version 23

Prior to the October 2023 update, the newer bank reconciliation process was available as an optional feature. With version 23:

• The updated bank reconciliation process is automatically enabled in all Business Central environments.
• Legacy Manual Bank Reconciliation and Bank Account Reconciliation with Bank Statement File options have been replaced.
• The previous reconciliation process can no longer be restored.

The functionality itself remains unchanged from earlier releases, but it is now the standard reconciliation experience for all users.

Starting a bank reconciliation

Before beginning, save your bank statement file locally and ensure it is closed. To create a reconciliation:

1. Search for Bank Account Reconciliations.
2. Select New.
3. Choose the bank account you want to reconcile.
4. Open the new reconciliation record.

After creating the reconciliation, import the bank statement by selecting: Bank → Import Bank Statement

During import:

• Business Central may suggest a statement date based on the imported file.
• Users can accept the suggested date or enter one manually.
• Statement number and ending balance information can also be entered.

Using automatic matching

The updated process includes automatic transaction matching to help reduce manual effort. To run automatic matching:

1. Navigate to Matching.
2. Select Match Automatically.
3. Enter a date tolerance.

The date tolerance determines how many days before or after a bank ledger entry posting date the system will search for potential matches. The appropriate tolerance depends on how your bank processes and posts transactions. After matching:

• Bank statement lines appear on the left.
• Bank account ledger entries appear on the right.
• Successfully matched transactions are displayed in bold green.

Manual matching and unmatching

Users can review automatic matches and make adjustments as needed. To remove an incorrect match:

1. Select the matched line on both sides.
2. Navigate to Matching.
3. Select Remove Match.

To manually match transactions:

1. Select the bank statement line and ledger entry.
2. Navigate to Matching.
3. Choose Match Manually.

This flexibility allows users to correct exceptions that automatic matching may miss.

Creating transactions during reconciliation

Sometimes a transaction appears on a bank statement but does not yet exist in Business Central. The updated process allows users to create those transactions directly from the reconciliation screen. To transfer a statement line to a journal:

1. Highlight the unmatched bank statement line.
2. Select Home → Transfer to General Journal.
3. Choose the desired journal batch.

Business Central creates journal lines automatically, allowing users to:

• Assign the correct account.
• Enter expense or revenue coding.
• Post the transaction.

Once posted, the new transaction can be matched within the reconciliation.

Completing and posting the reconciliation

A reconciliation is ready to post when:

• All bank statement lines are matched.
• All lines display in green.
• Total Difference equals zero.
• The calculated balance matches the statement ending balance.

To finalize the reconciliation:

1. Select Post.
2. Choose Post and Print.
3. Confirm the posting.

Users can then:

• Print the reconciliation.
• Save it as a PDF.
• Send it via email.
• Preview the document before printing.

Viewing posted bank reconciliations

After posting, completed reconciliations can be reviewed from the bank account card. To access historical reconciliations:

1. Open the bank account card.
2. Select Bank Account.
3. Choose Statements.

This area contains all previously posted bank reconciliations and allows users to drill into individual statement details.

Bank reconciliation automation

Business Central also supports automated bank reconciliation by linking bank accounts directly to online banking services. While the class focuses on manual statement imports and reconciliation, organizations can explore bank account linking to further streamline the reconciliation process and reduce manual intervention.

Key takeaways

The Business Central version 23 update standardizes the newer bank reconciliation experience and provides several benefits:

• Streamlined bank statement imports
• Automatic transaction matching
• Easy manual matching adjustments
• Transaction creation directly from reconciliation screens
• Simplified posting and reporting
• Access to historical reconciliation records

These enhancements help organizations reconcile bank accounts more efficiently while improving accuracy and reducing manual effort.