Monday, June 30, 2014

Automatic Bank Reconciliation in AX 2012 R3


One of the most interesting new features of Dynamics AX 2012 r2, and one which was crucially missing in previous versions, is the ability to import then automatically reconcile bank statements.
Bank Reconciliation, when done manually, can be an extremely long and tedious process. Some studies show that automating this process can reduce time spent on it by 70%.So, when you do the math, the return on investment can be very quick !
You must first of all set up the file format you want to import. For this you need to set up a Service /  AIF Inbound port, and link it to a bank format resource. AX 2012 comes with 3 standard formats : MT940, BA12 and ISO20022 (SEPA). All banks / countries using a specific format has been one of the key issues in the past, but the introduction of the common SEPA format inside the Euro-zone in 2014 should make this easier, for Europe at least. Of course, more formats can easily be developed and added to this list of resources.
Once your format is set up, you simply import the file received from your bank as a Bank Statement :
Dynamics AX 2012 r2

Microsoft Dynamics AX 2012
The detail of your bank statement is then read from your file and imported as a bank statement in AX :
Ax 2012, erp solutions
Now create a Bank reconciliation journal for this bank account, you will see that AX displays a screen with 3 sections :
1 - shows the transactions from your bank statement
2 – shows the unreconciled transactions on your bank account
3 – shows the transactions matched :

Automatic Bank Reconciliation in AX 2012
No transactions are matched so far, but you can now run matching rules, either one by one or in a pre-defined order (Matching rule set). These rules can be defined like this :

So, for example, the first rule can try to match transactions where amounts are identical AND Document Number in the statement = Payment Reference in AX, then the second rule can try to match only when amounts are equal. Tolerance can also be set on amounts, dates etc…
Once you run these rules, AX matches the transactions together. Here 2 transactions have been matched, and reconciled :
Microsoft Dynamics AX 2012
Your reconciliation was automatically performed. It can be amended manually if some transactions could not be reconciled automatically, then your reconciliation can be posted.
So AX 2012 now offers a highly efficient and flexible way to automate your bank reconciliation.
Until next time Cheers !

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