Bank reconciliation is the process of matching transactions in your accounting system against those on your bank statement to confirm they agree. Discrepancies, such as payments not yet cleared, transactions posted to the wrong account, or bank charges not yet recorded, are identified and corrected. In Microsoft Dynamics 365 Business Central, bank reconciliation is largely automated: bank feeds import statement lines directly and the system matches them against existing ledger entries using configurable rules.
How bank reconciliation works in Business Central
Business Central connects to your bank via an automated bank feed using Open Banking or manual import. Statement lines are imported and matched against open payment and receipt entries. Unmatched items are flagged for manual review. Once complete, the bank balance in Business Central matches the statement balance. A process that previously took hours can typically be completed in minutes.
Bank reconciliation in practice
- A finance team cuts month-end close from three days to one by using Business Central's automated bank feed and matching rules.
- A business with multiple bank accounts, GBP current, USD operating and a credit card, reconciles all accounts within Business Central through a single workflow.
- An accountant uses the reconciliation module to identify a direct debit missed from the accounting records, preventing a VAT reporting error.
- A small business owner delegates weekly reconciliation to their bookkeeper, keeping the accounts current rather than waiting until month-end.
How Advantage configures bank reconciliation in Business Central
Advantage configures bank feeds, payment method mappings and automated matching rules during implementation, so finance teams can reconcile from day one. Training covers exception handling and month-end close procedures within the system.
Frequently Asked Questions
Does Business Central support Open Banking bank feeds?
Yes. Business Central supports automated bank feeds through bank feed service providers, allowing statement lines to import automatically. The banks supported depend on your region and the bank feed provider configured during setup.
How often should bank reconciliation be done?
Best practice is weekly, or at minimum monthly. With automated bank feeds in Business Central, many businesses reconcile daily. It takes only a few minutes to match new transactions as they appear.
What happens if a transaction appears on the bank statement but not in Business Central?
Unmatched bank statement lines are flagged in the reconciliation worksheet. They can be posted directly from that screen, for example adding a bank charge or interest entry, without leaving the reconciliation workflow.
