Bank reconciliation and treasury

SmartERP Bank Reconciliation (peachtree_reconciliation, Auto_riconcil, and account_reconcile_oca) provides automated statement matching, uncleared cheque tracking, bank service fee clearing, and complete cash book alignment.

Bank Reconciliation Principles#

The bank reconciliation process ensures that the organization's General Ledger Cash Book perfectly matches the commercial bank's physical statement balance:

$$\begin{aligned} ext{Adjusted Bank Balance} &= ext{Ending Bank Statement Balance}
&\quad + ext{Deposits in Transit (Uncredited Deposits)}
&\quad - ext{Outstanding Cheques (Unpresented Cheques)}
&\quad \pm ext{Bank Errors} \end{aligned}$$

$$ ext{Adjusted Bank Balance} = ext{General Ledger Bank Account Balance}$$

Electronic Bank Statement Ingestion#

SmartERP supports both automated API bank feeds and electronic file uploads:

• Supported Formats: MT940 (SWIFT), OFX, QIF, and standardized Excel/CSV templates.
• Direct Ethiopian Banking Connectors: Pre-configured mappings for the Commercial Bank of Ethiopia (CBE), Awash Bank, Dashen Bank, Bank of Abyssinia, and fintech gateways (Telebirr, Chapa).
• Statement Header Verification: During upload, SmartERP verifies that the statement_opening_balance strictly matches the prior statement's statement_ending_balance.

Three-Tier Automated Matching Engine#

Upon uploading a bank statement, SmartERP executes a 3-tier algorithmic reconciliation pass:

+----------------------------------------------------------------------------------------------------+
|                             THREE-TIER AUTOMATED BANK MATCHING ALGORITHM                           |
+----------------------------------------------------------------------------------------------------+
|                                                                                                    |
|   UPLOADED BANK STATEMENT LINE                                                                     |
|   Amount: ETB 45,000.00 | Date: 2026-10-14 | Ref: CHQ-883921 | Memo: Payment MacShine Commercial  |
|             |                                                                                      |
|             v                                                                                      |
|   +--------------------------------------------------------------------------------------------+   |
|   | TIER 1: EXACT REFERENCE & CHEQUE NUMBER MATCH                                              |   |
|   | Search open journal items where account_move_line.cheque_reference == statement.ref        |   |
|   | AND account_move_line.amount == statement.amount                                          |   |
|   +--------------------------------------------------------------------------------------------+   |
|             |                                                  |                                   |
|       [Match Found]                                       [No Match]                               |
|             v                                                  v                                   |
|   AUTO-RECONCILED (100% Confidence)         +--------------------------------------------------+   |
|                                             | TIER 2: PARTNER TIN & AMOUNT MATCH               |   |
|                                             | Search open items where partner_id.vat matches   |   |
|                                             | AND abs(date - statement.date) <= 3 Days         |   |
|                                             +--------------------------------------------------+   |
|                                                       |                        |                   |
|                                                 [Match Found]             [No Match]               |
|                                                       v                        v                   |
|                                             AUTO-RECONCILED         +--------------------------+   |
|                                             (95% Confidence)        | TIER 3: MANUAL QUEUE     |   |
|                                                                     | Fuzzy Description Search |   |
|                                                                     | Multi-Bill Allocation    |   |
|                                                                     | Direct Fee Write-Off     |   |
|                                                                     +--------------------------+   |
+----------------------------------------------------------------------------------------------------+

1. Tier 1 (Exact Reference Match - 100% Confidence): Matches the bank statement line directly to a posted BPV, CPV, or customer payment using the unique cheque number (cheque_reference) or bank transfer reference. The system automatically reconciles the lines without manual intervention.
2. Tier 2 (Partner & Amount Match - 95% Confidence): If reference strings differ, the engine matches by Partner TIN, bank account number, and exact currency amount within a configurable date tolerance window ($\pm 3$ days).
3. Tier 3 (Manual Exception Queue): Unmatched items (such as unannounced customer wire deposits, bank service charges, or batch card settlements) route to the accountant's reconciliation screen with one-click creation presets.

Peachtree / Sage Style Bank Statement Reconciliation (peachtree_reconciliation)#

For accountants accustomed to Peachtree/Sage workflows, SmartERP provides the dedicated peachtree.bank.statement module:

1. Navigate to Accounting → Bank → Peachtree Reconciliation and click New.
2. Select the Bank Account and define the reconciliation period (begining_date to ending_date).
3. Enter the physical paper statement figures:
   • Statement Beginning Balance (statement_opening_balance)
   • Statement Ending Balance (statement_ending_balance)
4. In the Move Lines (line_ids) grid, the system automatically pulls all uncleared account.move.line items for that bank account.
5. Check off cleared deposits and cleared disbursements against the physical bank statement.
6. The system computes in real time:
   • Total Cleared Checks & Withdrawals
   • Total Cleared Deposits & Receipts
   • Outstanding Checks (outstanding_checks)
   • Deposits in Transit
   • GL Book Balance vs. Reconciled Balance
   • Unreconciled Difference: Must equal ETB 0.00 before the statement can be closed (state = 'done').

Bank Fee Clearing and Direct Reconciliation Models#

Bank statements frequently include items not yet recorded in the General Ledger:

• Monthly bank maintenance ledger fees (e.g. ETB 250.00)
• Wire transfer / RTGS commission charges
• Excise taxes on electronic transfers

SmartERP provides pre-configured Reconciliation Models (account.reconcile.model):

• Selecting the "Bank Service Charges" button automatically creates and posts an offsetting entry:
  • Debit: Bank Service Charges & Commission (611800)
  • Credit: Bank Account (111200)
• The statement line reconciles immediately in a single click.

Cheque and Certified Payment Order (CPO) Governance#

1. Uncleared Cheque Tracking: All issued cheques remain in the Outstanding Payments clearing account until they appear on a verified bank statement.
2. Stale-Dated Cheques: Under Ethiopian commercial law, cheques not presented within six months become void. SmartERP identifies uncleared cheques older than 180 days and provides an automated voiding wizard that reverses the original payment and restores the vendor payable balance.
3. CPO (Certified Payment Order) Accounting: When a CPO is purchased for bid security, funds are debited immediately from the bank account. SmartERP holds the balance in CPO Security Deposits Receivable (113500) until the bid is awarded and the bank cancels or releases the CPO.