Mistakes happen. They happen when the barista doesn’t easy foam your half-caf, extra hot, ristretto, touch of vanilla, flat white and they happen when you’re transacting in your ERP. Whether it’s posting to the wrong period, picking the wrong dimensions, or just fat-fingering in a wrong dollar amount, the number of possible places to err in a financial system are plentiful.
It’s easy to make mistakes. Correcting them should be, too. Over the years, Business Central has continually improved the ways you can fix these business boo-boos. In this series we’ll go over all the different ways you can undo or fix these slip-ups. To err is human – to correct, divine!
This series covers the following areas:
- Documents and Payments
- General Ledger and Bank Reconciliations
- Dimensions and Budgets
At the core of all accounting is the general ledger – the ultimate destination the eponymous “books” in bookkeeping summarize into. It is the foundational repository the financial impact of business activities and accounting distill into and the primary reporting point for financial statements. There’s a reason the meaning behind the word “ledger” is “to lay or remain” – after all the hustle and bustle of subledger activity, transactions wrap up and retire away into the permanence of the general ledger.
Musings and poetry aside, what that implies is that correcting the general ledger is a matter of sensitivity. Auditors will scrutinize corrections and adjustments at this level more closely, so doing this right and with an audit trail is important.
G/L Register Reversals
Say you posted a journal batch – payroll, year-end closing, or maybe a recurring journal entry – and you realize you made a dire mistake. In that case, instead of doing a manual entry, you can reverse the whole register:
- Navigate to the G/L Registers page (note the plural so you don’t confuse it with the G/L Register report in the search!)
- Find and highlight your register:
- Go to Reverse > Reverse Register… in the ribbon:
- Choose to either Reverse or Reverse and Print in the ribbon, depending on whether you need a paper/PDF trail:
- Confirm your action in the prompt;
And, assuming you’re allowed to post to those dates, the G/L account, dimensions aren’t blocked, etc. you should now have a reversed entry.
A few neat flags will also be set behind the scenes. The “Reversed” field on the G/L Register will be set to “Yes” for both the original G/L Register and the reversal:
But also on the G/L Entry table you’ll have both the “Reversed” flag set to “Yes” but also a proper accounting of which entry numbers reversed which, etc.
Which will undoubtedly give your internal and external auditors the warm and fuzzies.
Note: For obvious reason, you cannot the register reversal function for entries that originated from a subledger, as that would invariably lead to a discrepancy between your subledger and general ledger.
General Ledger Entries
Reversing a whole register is great and all, but what if you’re just reviewing the general ledger entries and want to zero in on one specific Document No. within a batch to reverse, you can do that, too:
- Navigate to the General Ledger Entries and highlight one line in the Document No. you want to reverse:
- Go to Process > Reverse Transaction… in the ribbon:
- This will open up the preview pane showing you what you’ll be reversing, including which ledgers will be affected by the reversal (in the example below, we have G/L Entries and Vendor Ledger Entries that are affected):
- Click Reverse or Reverse and Print… in the ribbon to post the reversal;
- Confirm your action in the confirmation prompt;
As with the G/L Register reversal, there are some audit fields populated behind the scenes in the G/L Entry table:
As well as the Vendor Ledger Entries:
Few things can give joy to auditors like a decent audit trail!
The historical information chasm between the bank statement and the bank subledger has increasingly narrowed over time. The old process of waiting for paper statements in the mail to perform highlighter-and-red-pen reconciliation evolved to receiving statements electronically and reconciling in Excel to now having bank feeds directly feed into the cash management module of your ERP and having fuzzy logic try to automatically match and clear statement lines. While a lot has been done to streamline the process of bank reconciliation, there is still some manual intervention required which also means there is a higher likelihood of issues and errors popping up in the process.
With the Spring 2021 release of Business Central, a new feature was added for reversing these problematic postings. Let’s dive right in!
Note: This feature is currently only available for bank reconciliations posted using the auto-match bank rec. flavour.
After posting your Bank Account Reconciliation, the rec. posts through as a “Statement” of the Bank Account. To find your Statement, you simply:
- Go to the Bank Accounts list (also available in the card page);
- Search for or menu-dive to (Related > Bank Acc.) the Statements page:
- Click Undo on the Statement you want to reverse:
At this point you’re asked if you want to reverse and create a copy of the Bank Rec. Saying “Yes” is good for a situation where you just want to tweak one or two things (i.e. remove a cleared item, for example), while “No” is to whole-sale back this out so you can do something from scratch:
And there you have it. Slip-up unslipped up!
Changing Statement Number
New bank reconciliations typically sequence themselves based on your Last Statement No. on the Bank Card, but sometimes that isn’t what you want to name your statement.
Eagle-eyed folks will notice that the Statement No. is a non-editable field on the Bank Rec.:
However, there is a function you can use to change the statement number. If you navigate to the Bank Account Reconciliations page (the list page of all the open recs.), you’ll see there’s an action you can use to change the number:
Which in turn prompts you to give it a new number:
A quite simple, but very useful, function.
Have you got questions about Dynamics 365 Business Central? Contact us and one of our solution advisors will get back to you.