Units must regularly monitor and reconcile their financial activity within Banner to ensure accurate financial reporting for the University of Illinois System’s audited financial statements and to safeguard system resources. See below for a few tips to keep in mind when performing these reconciliations:
- Reconciliations should be performed by someone knowledgeable about the unit’s operations to the extent that they can identify and communicate problems that may arise.
- Segregation of duties is also an important concept to remember when assigning reconciliation responsibilities. For example, the person reconciling expense transactions should not be the same person who is making the purchases that are being reconciled.
- Reconciliations should be performed on a regular, ongoing basis. Most good business practices recommend monthly reconciliations, but the nature of the activities and the risks involved may require more frequent (such as daily) or less frequent (such as quarterly) reconciliations. It is up to you to decide what is best for your unique scenarios.
- Reconciliations should be clearly documented to provide evidence that the reconciliation was properly completed and reviewed. This will be helpful in situations where you may be audited or where senior executives want to see results of past reconciliations.
- If shadow systems are used, remember that it is essential to reconcile the shadow system to Banner, which is the U of I System’s official system of record. All transactions within the shadow system must eventually reconcile to Banner.
- It is important to reconcile not only the revenue, expense, and fund transfer activity within the operating ledger (OL), but also the asset and liability activity within the general ledger (GL). This is essential when reconciling fund types that commonly have GL activity (such as self-supporting funds or service plan funds). The omission of a GL reconciliation could potentially lead to stagnant and incorrect balances within the GL.
While these are just a few tips to help get you started, a more detailed analysis of the reconciliation process is available within the new Reconciliation Guidance document, which was recently produced by a cross-functional team consisting of team individuals who have a strong interest in providing more resources for those who perform financial reconciliations.
Finally, for further information on financial reconciliations, refer to Section 13.4 Reconciliation of Financial Activities within the Business and Financial Policies and Procedures.
Contact
For further details, reach out to UAFR at (217) 333-4568 or refer to an applicable subject matter expert within the Who to Ask list.
