Reconsilation Accounts

[Former Member]

HI,

Generanlly we will have number of Customres/Vendors....how the reconsilation accounts can be maintained.if we maintained only one Reconsilation a/c for all customers/vendors..is it okkk.

give me the best way means <b>"single reconcilation account for all customers/vendors or it is best to maintain different reconcilation accounts to each and every customer/vendors?</b>

clarify my doubts

Regards

Sap Guru

[Former Member · Accepted solution]

Hi Guru,

It dpends up on the Business requirmemnt, How you want to do the analysis. If you want to mantain a single recon account for all the customer then you can do that. Usualy companies mantain the recon accounts according the account groups they have like, We will be having account groups according to country, region or like retail customer group or whole sale lcustomer group. So we can have different recon accounts for each type of account group. Again everything depends on the clients specific requirement. How many accounts (master data) they want to mantain.

Regards

Pratiksha

[Former Member]

HI,

First I will try to explain what is the normal scernio in the accounting point of view.

See if I am issuing a downpayment to the vendor the entry would be.

Vendor Account Dr.

To Bank Account Cr.

As per the logic the downpayment is a current asset of the company hence, it is belongs asset side of balance sheet in the different head. In sap we are putting Loans and Advance paid account as a reconcilation account for the downpayment accordingly the downpayment comes under Loans and Advance paid account.

The same scnerio for advance received for our customers.

Bank Account Dr.

To Customer Account.

Here the amount what we have received is a liability of the company hence, it is showing under customer head in the liabiltiy side of the balance sheet. here as per sap we are assinging Loans and Advance received account as a reconcilation account for the advance received from customers.

Hope you might have understand the concepts.

as per your point of view maintaining a signle reconcilitation account concept was warong and it was againsted to the priniciple of acconts.

Warm Regards,

Sivakumar Sathiyamoorthy

[Former Member]

You have to group your customers and vendors:

One example is:

Domestic customer- this can be further subdivided in to

Private sector

Public sector

Government dept

Foreing customers

IC customers

For each group u can create separate recon account

Similarly you can also group all like vendors and for for each group assign it to a recon account. No useful purpose will be achived by clubbing all vendors and customers in a single recon account.

[Former Member]

Thanks alot sivakumar,

what i mean to ask you is can i assign one reconcilation account to all my customers,,,or shall i maintain differant reconcilation accounts for each customers....i know that we can do in both of the above cases..

<b>

i want to know is which is the best way...one reconcilation account to all customers or different reconcilation accounts to different customers</b>

Regards

Sap Guru

[Former Member]

I already gave my reply. You should not have one recon account for all the customers. Group the customers and assing it to one recon account like domestic etc.

Similarly for your vendors also.