The Clear LineREPORTING
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Data quality

Reconcile to source: the one rule behind reports people trust

Credit committees, funders and trustees rarely ask how a report was built. They ask one question: does this number tie out? If the answer takes a day to find, trust in the whole report drops, however good it looks.

What “reconcile to source” means

Every headline number in a report should be traceable, automatically, to the system it came from. For lenders, that usually means three checks:

CheckReport figureCompared with
Portfolio balanceTotal net balanceLoan system balance and the GL control account
Loan countActive loansLoan system active loan register
MovementsOpening + advances − repayments ± adjustments = closingTransaction totals for the period

Build it in, don’t bolt it on

  • Make reconciliation a page in the report. Show each check with the difference and a pass or fail flag. If it fails, everyone can see it before the report goes out.
  • Reconcile at the grain you report. If the funder report is by warehouse and product, reconcile by warehouse and product, not just in total.
  • Explain known differences. Timing differences and suspense items happen. List them with a reason, rather than letting them hide in a rounding line.
  • Keep the history. Store each month’s reconciliation result so you can show auditors that the report has tied out every month, not just this one.
A report that reconciles is a report people stop questioning, and start using.

It is a small amount of extra work at build time, and it pays for itself the first time a funder asks a hard question.

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