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How do you locate a competent professional to perform a complex bank reconciliation?
If you have tried to hire a consultant to fix a bank reconciliation problem, you were probably surprised at the lack of depth many accounting consultants have in this specialization. A bank reconciliation for a bank account with more than 200 transactions and potentially multiple bank accounts and ledger accounts requires someone with a deep background in reconciling bank statements.
A few questions can tell you if they have the experience and skill necessary to perform the task. Here are important questions to ask:
Does the consultant use a specialized program to perform bank reconciliations?
If their answer is no, then they are likely going to spend too much time doing the bank reconciliation. A pencil and paper method can be as accurate as a computer program. However, it is ALMOST ALWAYS slower and costs more money for a ledger with more than 200 transactions in one month. This tends to be true regardless of the professional's experience.
Using a simple excel spreadsheet that a professional has doctored up is not enough. It must be a specialized bank reconciliation program to really reduce the time to perform the reconciliation.
Your computer accounting system IS NOT TOO COMPLICATED NOR TOO OLD to use a computer program for bank reconciliations.
(If applicable) Has the consultant ever performed a bank reconciliation for multiple ledger accounts (in a pooled cash arrangement)?
Many organizations, especially city governments, use a "pooled cash" arrangement where multiple general ledger accounts and potentially multiple bank accounts must tie to each other as a whole. Some software vendors get confused by this and tell you to reconcile each cash account "individually" not realizing that you CANNOT do that with a pooled cash arrangement.
What kind of background does the consultant (or their firm) have in bank reconciliations?
Make sure there is an individual at the firm that has actual experience performing bank reconciliations with a specialized bank reconciliation program and has knowledge beyond "knowing how to do one".
We have come in after the fact on numerous occasions to clean up work by other consultants. On some occasions, the consultants simply gave up and left. If these three questions had been asked beforehand, it would have weeded out almost all of the bad consulting engagements that these clients experienced.
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