BlackLine Reconciliation Templates, Study notes of Business

Download BlackLine Reconciliation Templates and more Study notes Business in PDF only on Docsity! Trust is in the Balance™ BlackLine Reconciliation Templates provide a best practice approach to ensuring the accuracy, quality, and completeness of your account reconciliations. Our standard Reconciliation Templates, as detailed in this guide, are available out of the box to support the most common reconciliation types and can be further adapted to meet your organization’s evolving goals and requirements. BlackLine Reconciliation Templates Trust is in the Balance™ The Accruable Items template is used to manage reconciliation items expensed and accrued in the current accounting period and paid in a future accounting period. Examples include accrued property tax, general expenses, or services. You can establish categories of accrued items in one account, and related activity for each category will display on the account reconciliation. Accruable Items Accrual Items The accruable item activity history is stored together with each accruable item. The expected balance is automatically calculated for each item based on the sum of activity from prior and current periods. If desired, future periods can be loaded in advance and will be automatically included in the calculated balance in the appropriate future periods. GL Balance Populated with the Accounts template format and is the level at which your organization wishes to sign off on reconciliations. This is the most essential import to populate BlackLine, and the one customers most often automate. 1 1 2 2 Trust is in the Balance™ The Amortizable template is used to monitor expenditures or revenues in one accounting period that are recognized over several future periods. This reconciliation template allows you to record payments or revenues for amortizable or deferred items and establish a monthly schedule of the expenses or revenues to record over the life of the prepaid or deferred item. BlackLine automatically creates a straight line schedule for the amortization or deferral amounts over future periods. Non-straight line schedules are also easily created in this template. The Amortizable template can be used for: • Prepaid Property Taxes – These items, typically paid once a year or on a quarterly basis, need to be expensed over the period defined by the taxing authority. • Prepaid Licenses – This pertains to items such as vehicle license fees or fees charged by a governmental agency on an annual basis (e.g., CPA license fee, Surface Water Discharge permit). • Prepaid Heavy Vehicle Tax – In some cases, fees charged by the IRS apply to future periods. An example is the Heavy Vehicle Use Tax that is paid when you file your Form 2290. • Deferred Revenue – To record the recipient of prepayments for product goods and services. The prepayments are recorded as unearned revenue – revenue that has not yet been earned but represents products or services that are owed to a customer. Amortizable Trust is in the Balance™ The Partial Amortization feature allows organizations to calculate amortization schedules on a daily basis (rather than on a full calendar, straight line basis), to allow for partial period calculations. When enabled, the BlackLine system allocates the balance partially in the first and last months of the schedule and evenly distributes the remaining amount across the months in between. Roll Forward The amortization schedules are stored together with each prepaid item, and a built-in roll forward schedule displays balances and activity for all items in a single screen. Balance The expected balance is automatically calculated for each item and is automatically updated each period. If the sum of expected balances ties to the GL Balance in total, the account will be auto-certified. 1 1 2 2 Trust is in the Balance™ The Associated Accounts template enables the comparison of sets of imported account balances and supports non- exclusive grouping as well as existing reconciliation functions. This template can be used for the: • Comparison of IFRS balances to GAAP balances • Comparison of regulatory balances to statutory balances • Comparison of a set of account balances to a single account balance Associated Accounts Trust is in the Balance™ Basis of Calculation The basis for the calculation appears on the face page and can be rolled forward to new reconciliations. Supporting Items Additional reconciling items can be manually input by Preparers or automatically imported and are accessible on the face of the reconciliation. Supporting Documents Calculations can be attached as Supporting Documents to enable quick and easy access to additional detail. 1 1 3 2 2 3 Trust is in the Balance™ This commonly used BlackLine reconciliation template is designed to be flexible to support any type of account. With the General List template, users can enter items that make up the ending balance in a Balance Sheet account. It can also be used to accumulate information for an Income or Expense account. Examples of accounts that can use the General List template include: General List • Petty Cash – Though this is an account that deals directly with cash, the most appropriate type of reconciliation simply lists the details of who has how much money. • Inventory Account – Items that are held for resale or for future use that are in an Inventory account. • Deposits – Amounts paid to a vendor or supplier that you expect to be refunded at some future date. • Prepaid Expenses not Amortizable For example, Prepaid Rent that is paid to a landlord on July 31 for rent due on August 1. • Common Stock – Amounts originally paid in to the company when shares of stock were sold. • Retained Earnings – An accumulation of all the profits and losses of the company since it was formed (accumulated profits will have a credit balance, accumulated losses will have a debit balance). • Miscellaneous Income – Items that do not normally fit in to your routine business operations and that must be explained in detail. • Gain on Sale of Assets – Identify specific assets sold and the proceeds on each sale. • Repairs and Maintenance – Greater than $10,000 (or any limit your accountant or manager wants to see). Identify significant expenditures that may not be recurring in your normal operations. • Legal Expense – Identify the lawyers used by the company during the year and the litigation that may need to be reviewed during an audit. • Bad Debt Expense and Write Offs – Keep track of customers that failed to pay the company. Trust is in the Balance™ Supporting Items Line items within a reconciliation can be populated automatically via the Items template format, semi-automatically through the Excel-based import template by the System Administrator, semi-automatically through Excel (in bulk) by the Preparer, or manually by the Preparer. Items may also be imported from queries or Matching, if desired. If imported automatically or with the Excel-based templates through the System Administration role, clients can take advantage of the auto-certification rules. GL Balance The GL Balance field is populated with the Accounts template format and is the level at which clients wish to sign off on reconciliations. This is the most essential import to populate BlackLine and the one that clients most often automate. 1 1 2 2 Trust is in the Balance™ Suspense accounts are used to temporarily record transactions before they are allocated to their proper account. BlackLine’s Suspense Template provides a means to automate and control the reconciliation and reporting of these suspense items from a predefined source. With this template, organizations can: • Periodically import item count and aging and business justification details, if desired. • Define the categories for aging and business justifications. • Lock down key fields (e.g., item count, aging) to ensure preparers work within the required items that the ERP system provides at period end. This reduces the amount of monitoring that must be done on a large portion of the Balance Sheet. • Identify high-risk items across multiple suspense accounts at one time. In the insurance industry, suspense accounts hold unfunded remittances, serving as a holding account for monies received that cannot be released (e.g., in-transit policies, disputed claims, monies held due to legal issues or timing of day-to-day operations). These accounts often make up a large proportion of an insurance company’s liabilities and have specific SOX control requirements – accounts must be analyzed by type of product, aging category, and business justification. Suspense Trust is in the Balance™ Suspense Items The Suspense Items provides a summary of open items by Item Total and Age Type. The total of Suspense items is compared to the GL balance. Business Justified Items The lower section of the reconciliation provides a means to document the detail of those items labeled with an Age Type designated high risk. They appear on the reconciliation and are summarized by the Business Justification Type. The subtotal of those items is compared to the high risk total. 1 1 2 2 Trust is in the Balance™ Additional Template Controls ERP Drill Down The ERP Drill Down feature enables users to access account transaction details directly on the face of the reconciliation, so there is no need to navigate between BlackLine and the organization’s ERP and/or other third party systems. BlackLine does not circumvent the security of your ERP system, so users without access to the ERP, or a particular account, will not be able to see anything even when this feature is activated. Hyperlink This control enables users to add a hyperlink to a document stored in another system as supporting documentation for a reconciliation in BlackLine. The document itself is not stored in the BlackLine document repository, but a link to the document is stored so that the document can be easily accessed within the BlackLine system. Integrated Spreadsheets The Integrated Spreadsheet control can be added to any BlackLine Reconciliation Template. This feature enables the creation of highly customized reconciliations to accommodate the most challenging scenarios and eliminates the need for supporting spreadsheet documents. Approvers and reviewers are presented with a fully functional spreadsheet on the face of the reconciliation and have quick and easy access to view all calculations. Related Account Balances The Related Account Balances functionality allows users to view the GL balance and link to other accounts which have been linked to their reconciliation. Users can view a grid of all open items which belong to the related accounts, and these related accounts, once added, will carry forward to future periods automatically.