Supplier statement reconciliation might not be high on your agenda… Between making sure suppliers get paid promptly – and fielding enquiries about WHEN they’re going to get paid – you haven’t got the time to speculatively match up thousands of documents and data points.
But completing supplier statement reconciliations will save you time and could equate to millions in savings. So why don’t more AP teams do them?
Here’s the headline news about the most unrated element of Accounts Payable – the humble supplier statement reconciliation – and how your AP team can start reaping the benefits fast.
What is a supplier statement reconciliation?
A Supplier statement is a report from your vendor’s accounting system(s) that lists information like your outstanding invoices or credits that are due back to you.
Supplier statement reconciliation is the process of comparing these against your purchase ledger and making sure they match up.
It’s an opportunity to:
- Check all invoices and credits have been received as expected
- Spot any discrepancies between your ledger and supplier statements
- Proactively resolve any errors that could prevent suppliers being paid on time
What are the benefits of supplier statement reconciliation?
Proactive supplier recs have a whole heap of benefits – for you, your team and your business.
- Catch erroneous payments before money leaves your account
- Reduce time and resources spent trying to recover incorrect payments
- Ensure you receive the discounts and credits to which you’re entitled
- Improve the accuracy of your supplier liabilities and financial forecasts
- Improve paid-on-time rates and other team KPIs
- Minimise disruption from damaged vendor relationships or suspension of services
Put simply, supplier statement reconciliation makes sure working capital is maximised and problems are minimised. And what AP professional wouldn’t want that?
We recently caught up with Rachael Long, Accounts Payable Manager of Breedon. We asked her what her one piece of advice is for people in AP.
And what did she recommend? You guessed it – do supplier statement reconciliations.
‘When I first started at Breedon, I did two years of statement reconciliations and was able to find nearly £2 million of lost cash. There’s so much value in doing reconciliations. Not just financially but in terms of reputation, reporting and relationships too.’
Why don’t all Accounts Payable teams do supplier statement reconciliation?
With all those benefits, completing supplier statement reconciliation seems an obvious – even essential – task.
One of Xelix’s customers recently described supplier statement reconciliation as ‘the golden control’.
‘If you reconcile 100% of your spend against supplier statements every month, all your problems go away,’ they explained. ‘Supplier enquiries, missed credit notes, late payment problems… they’re all eliminated when you complete supplier statement recs’.
In which case, why don’t more AP teams do it?
‘The problem is that it’s a heavily manual process. Most AP teams can only have time to reconcile a few suppliers. It’s the first task you choose to lose when you’re busy at quarter-end.’
Faced with payments to make and suppliers to soothe, supplier statement reconciliation isn’t always a top priority.
And who can really blame overstretched staff for ditching it?
It’s time-consuming and laborious. So consequently, it gets neglected.
Reconcile. Complete. Send. Repeat.
Unfortunately, failure to complete supplier statement recs can trap AP teams in a reactive cycle.
You get stuck responding to the problems that arose from not doing recs last month. And that means you’re too busy to do the recs this month.
You need something to break that vicious cycle and give your team their time – and mojo – back.
Now for the good news. Supplier statement reconciliation can now be completed in a fraction of the time using our AI-powered software to automate the process.
Instead of employees spending days on tedious and time-consuming manual recs, you can simply run a report and see all discrepancies in minutes.
This frees up staff to simply reconcile, complete, send, and repeat, which means…
This makes the argument for adding it to your AP processes stronger than ever.
How can Accounts Payable automate supplier statement reconciliation?
You can now reconcile supplier statements in minutes and keep your suppliers updated, all from within the Xelix platform.
- Already conduct supplier reconciliations? Automation will save you days of hard graft. Our almost-instant reports free up your team to focus on fixing the problems, not finding them.
- Don’t conduct supplier recs yet? Xelix will unlock the benefits of regular supplier reconciliations for your business, without condemning your team to days of data checks.
And don’t forget, solving supplier payment problems before they escalate saves even more time for your team. It’s a truly virtuous circle.
Don’t take our word for it
Joanna Baines, Transactions Manager – PTP, at leading British Manufacturer, McBride, described Xelix’s reconciliation module as:
“The most effective statement reconciliation programme I’ve ever seen. It’s just amazing.”
“With Xelix’s new feature we simply choose the reconciliation date, upload the statement, and press a button. Xelix reconciles it and highlights any errors or omissions. Once complete, we have a branded Excel or PDF to send to our supplier. It’s much faster.”
Will you find hidden millions?
Ask for a free spin of Xelix’s recs module and discover what your discrepancies are worth – get in touch now!