USE CASE
Cash account
reconciliations
Most commercial activity results in some kind of cash transaction, so investigations, when they happen, often involve a wide range of internal and external stakeholders and loads of manual work to identify true root causes of breaks.
Due to their nature, cash reconciliations require a high level of oversight, and receive significant scrutiny from regulators. Getting it wrong can be costly, with significant fines for responsible parties if controls are not properly implemented and managed.
How Duco adds value
Duco’s powerful matching engine improves match rates out of the box. Our no-code, data agnostic platform means business users can set up cash reconciliations, complete with automated labelling and workflows with in a matter of days. Without the need for lengthy IT projects.
With Duco, you can ditch upgrade costs, eliminate the proliferation of point solutions, and reduce the time to market for new products.
CHALLENGE
The cost of unnecessary manual work
Frequently cash reconciliations require hours of resource-hungry manual work on complex break investigations for simple data errors that should have been picked up.
SAVE TIME AND DITCH MANUAL MATCHING
Starting checks, tolerances and the ability to include additional data elements to your cash process improve accuracy and help to eliminate manual matching.
CHALLENGE
Account governance
Accounts don’t always line up. When statements have multiple sub-accounts that need to be reconciled against a single one on the internal ledger, you may end up stuck with multiple repetitive processes.
ELIMINATE REPETITIVE PROCESSES AND GET CONTROL OF YOUR ACCOUNTS
Consolidate various account combinations into one process. No more managing data across multiple views. You can run the same process for multiple accounts, saving time and avoiding duplicate manual work. And everything is automatically documented for complete audibility.
CHALLENGE
Cash investigations involve a lot of people
Cash break investigations are broad and complex. They can hit investment teams, trade operations, and finance as well as external counterparties. With this many people involved, investigating false breaks can create chaos.
REDUCE FALSE BREAKS AND AVOID UNNECESSARY INVESTIGATIONS
Use Duco’s Natural Rule Language to set up auto-match rules and exception tolerances to filter out the noise of false breaks. Transactions under the tolerance can automatically be matched – no investigation needed.
CHALLENGE
Adapting to change is a challenge
Legacy tech, especially on-prem solutions, can struggle to keep up with changing file formats and new processes. Adapting your processes to new requirements can be challenging and costly, inhibiting business improvement.
FLEXIBLE, SCHEMA-FREE MODEL ADAPTS QUICKLY TO CHANGING REQUIREMENTS
Duco’s SaaS model eliminates the need for costly upgrades when requirements change. And you can change or create new reconciliations within hours, without large development projects. Rules are easy to update, test and promote through dedicated sandbox/UAT environments.
Seeing is believing
Book a 30 minute demo to see Duco in action and discover a faster, smarter way to manage your data.
Cash reconciliations FAQ
At the highest level, a cash reconciliation is a firm’s control of activity and balances between their internal and external bank accounts or internal books of record.
All perform cash reconciliations, and the larger the firm, the more complex the reconciliation, and the more robust the controls need to be. These can include integrity checks and standardized workflows.
External account recs:
- A firm’s control of their internal book of records vs their Cash held with other financial institutions
Internal account recs:
- Comparing activity and balances between ledger and subledger (eg accounts payable vs customer accounts or vendor accounts.
- Temporary account reconciliations, a.k.a. wash, suspense, or zero balance account reconciliation.
Firms need to reconcile cash (& associated securities movements) with external financial institutions to:
Ensure correct financial reporting
- Detect fraud
- Ensure client funds are secure
- Have enough liquidity to meet obligations (investor protection)
They do internal reconciliations to:
- Detect fraud
- Have enough liquidity to meet obligations (investor protection)
- Ensure accuracy and completeness of records across ledger and subledger
- Ensure all transaction that can’t be attributed immediately are eventually allocated
- Ensure suspense accounts zero balances
These more traditional reconciliations are universal, mandatory and mission critical.
Lack of agility, increased risk from off-system workarounds, tangible & intangible costs:
- With a legacy/on-premise tool, even small changes mean IT projects, so budgets are allocated to maintenance & upgrades rather than business improvement.
- When time and money run out, teams go off-system and custom design processes to plug remaining shortcomings of legacy/on-premise solutions installed decade(s) ago
- As these off-system processes and workarounds scale up and get embedded, the amount of time teams spend struggling with spreadsheets/errors/audit issues grows, and the business agility decreases. Teams are drowning in KTLO tasks instead of solving real business problems/future proofing their software.
How Does Automation Improve the Cash Reconciliation Process?
- Automation enables you to build your workflows around best practices. Without automation, workflows (and workarounds) are typically more spreadsheet and email based, thus slower, more prone to error and more opaque.