Reconciliation links every bank transaction to the corresponding receipt or payment in the books. It sounds mechanical because it is. The difficulty is that bank statements were not designed for this job.
Why it's harder than it seems
- The transaction description says very little. An incoming transfer may show an individual's name rather than the company that owes the invoice.
- Amounts do not always match exactly. Fees, withholding, or a partial payment can defeat an exact-amount search.
- One transaction may cover several invoices. A client paying three invoices in one transfer is common, not exceptional.
- Dates move. The transaction date and value date may be different.
More willpower solves none of these problems. A repeatable process does.
The formats
Banks in the Principality export the standard formats used across European banking. Find out which ones your bank offers:
| Format | What it is | When to use it |
|---|---|---|
| CSV | A spreadsheet using columns chosen by each bank | The easiest to obtain and the least predictable: columns vary between banks and sometimes between export versions |
| OFX | A structured financial exchange format | Better than CSV because the fields are always the same |
| CAMT.053 | The ISO 20022 standardised statement | The richest option: stable transaction identifiers and reference fields that improve matching |
The rule that changes everything: importing twice must not create duplicates
This is what makes frequent reconciliation safe. If you can re-import a statement that overlaps an earlier import and the system recognises existing transactions, then:
- You can import weekly without waiting for the monthly cut-off.
- You can resume an import interrupted halfway through without cleaning up by hand.
- You can export a wider date range when you suspect something is missing.
A suggestion is not a decision
A system can suggest which document matches each transaction and get most of them right. It should not apply every match automatically and hope someone reviews the result later.
The practical difference is explainability. If a suggestion tells you why it exists—the amount matches, the description contains the invoice number, or the date fits the due date—you can review it in seconds. Without that reason, review takes as long as manual matching.
Every decision must be reversible
Matching a transaction to the wrong document will happen. Undoing that decision should be straightforward.
- Unreconciling must return both sides to their earlier state without leaving a partial journal entry behind.
- Ignoring a transaction must be visible and reversible, not a way to hide it.
- Reopening a closed reconciliation must record who did it and when.
People do not adopt a process they cannot undo; they learn to avoid it.
A rhythm that works
- 01Every weekImport the statement and reconcile the obvious matches. Ten minutes prevents a backlog.
- 02Every monthReview the remaining items while you still remember what they were.
- 03At every closeConfirm that the ledger balance matches the bank statement and that every difference can be explained in one line.