Why do we issue customer statements to our customers?

There are actually three types of statements you can give. There is Transaction, Open Item and Balance Forward.

A transaction statement is a list of all the transaction we had between two dates.

Customer Reconciliation

Reconciling with customers means proving your accounts receivable records are correct. Either party may have made a mistake. What kind of mistakes could there be? There could be missing transactions, duplicate transactions or inaccurate transactions. What is the process?

1. Start from the point that you and your customers agree that your records match the customer records to the last detail. if you have not been sending statements or reconciling for quite a while, you will have to go back to the very last moment that your records matched your customer records.
2. The customer will go through the information we sent them. If the customer does not agree, they are responsible for contacting you to discuss the differences. It’s similar to when your phone company sends you a bill and you don’t say anything, it is assumed that the bill is correct in your eyes.

If you are on the phone with the customer going through each transaction one by one, the best report to use is the Transaction List by Customer. This report allows you to double click on any transaction that is different. And then once you double click, you can go right back to that transaction and see exactly what happened. You can fix anything in that transaction to make sure it matches with your customer. You can then send an updated statement to the customer.

What would be an example of a difficult mistake to find and fix when reconciling with customers? A misapplied payment. Suppose you applied a payment to the wrong invoice. With this mistake, the customer total balances will be the same, and correct.

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