A business that deals with sales to the general public, especially those which are solely online, may benefit from payment reconciliation. The steps for payment reconciliation may vary depending on the type of business and the types of payments or balances due. A company seeking payments from consumers may employ tactics which are slightly different than business to business payments. Such steps may include matching invoice data to income to find discrepancies, contacting those who owe payment or even reconciling errors with financial institutions.
Many companies manually reconcile all payments that come from clients or other sources. This can sometimes result in payments or data going missing, but is still preferred by those who do not wish to invest in reconciliation software. Electronic payment reconciliation steps are designed so the system can automatically gather and compare all of the relevant reports and send the results to the proper management unit.
Once the data is gathered, the next payment reconciliation steps involve the computer software or personnel sorting and assigning all of the data. This can be done by product or business line or any other criteria determined by the business owners so relevant data is kept together. Then, each piece or collection of data can be assigned to the relevant employee that deals with that data. The next steps generally include transferring, either with the software or manually, all of this data onto a spreadsheet or other such system so it is easy to review all the deposits and charge backs.
Credit card processing may also be a step in some businesses’ process of payment reconciliation. This includes transactions and the names, telephone numbers and addresses of the clients. It is important to most companies to have a software or third-party hosting which can deal with this in order to properly process payments and capture credit card information. The system may then decide for the company whether it should be writing off the non-received payments or re-presenting them.
The last few steps will need some human interaction purely to assess the information that the payment reconciliation program has produced. Most often, the staff is not generally required to research anything and must only act on the information that has been provided. These actions can include contacting payees or filing data for quarterly reviews. If payments are not able to be reconciled, they are considered outstanding and, in most companies, they become high priority and can seriously affect business and customer relations. It is important for companies to reconcile all payments possible, but most have a margin for unpaid debts built into their budgets.