When you look at the Bank Statement and see an amount staring back at you, it's like an orphan looking for a home. This bank deposit does have a home and as a Receivables or AP person, it's your job to match this deposit with the Invoice that it is there to pay off. The match that makes everything whole again.

Matching amounts to invoices sounds like a simple and straight forward activity, and many times it is, and many times it's not.

Imagine that you have sent a number of invoices amounting to $12,876.76 and you receive a bank deposit of $11,887.23 - how are you supposed to apply this cash to the outstanding amounts your customer owes you?

You could apply the cash on the basis of paying off the oldest amounts first.

You could apply the cash by sorting through the outstanding amounts and looking for a combination of amounts that add up to the amount you have received.

You could go back to the customer and ask what invoices they are paying?

You may also receive a document (a “remittance”) with the deposit that may come to you via email.

The remittance document is likely to list all the invoices and amounts that add up to the amount deposited in your bank account.

These files, remittance files, can be sent to you in a variety of formats like spreadsheet files, text files, images of what was on their screen and a few more types.

The idea here is to use these remittance files to correctly identify the amounts that are being paid off.

To learn how to use Remittance filed such as PDF documents, have them scanned and match off your outstanding invoices visit kilshaw.co to learn how.