Automating Multi-Way Transaction Matching with Adra Matcher
Blog post
Share
Accounting departments have long faced the challenge of reconciling across multiple sources of data, commonly known as multi-way matching. In the multi-way match process, multiple sources of data must balance out each other to identify discrepancies that represent a risk to the company.
With Adra Matcher’s automated multi-way matching feature, users can set up match scenarios between three or more sets of data. These scenarios can be implemented to run automatically upon import of data into Adra Matcher.
Challenges of Scaling Multi-Way Transaction Matching in High-Volume Reconciliation
Multiple factors contribute to the complexity of multi-way transaction matching. In many scenarios, accounting teams are manually performing this type of matching on high transaction volume accounts. In a 2-way matching scenario, manual high-volume transaction matching can be an incredibly time-consuming process with a high likelihood of human error.
Adding a third source to the matching process at least doubles the amount of time to manually match the data and investigate the discrepancies, further increasing the risk of error. It also adds a new level of complexity to the matching scenario to ensure that a single transaction matches across all three sources. As companies grow and begin to reconcile new sources and higher volumes of data, a manual multi-way matching process cannot effectively scale to meet the company’s reconciliation requirements.
Multi-Way Matching in Restaurants
Adra Matcher is used by a large number of restaurants that experience challenges with multi-way matching. Condado Tacos, a restaurant with multiple locations across the United States, implemented Adra Matcher to help. As part of the company’s reconciliation procedures, the accounting department must verify that there are no discrepancies between the transactions recorded on the point-of-sale (POS) system, the bank statement, and the general ledger—a process that has only become more disparate with the advent of third-party delivery services.
Before implementing Adra Matcher, the accounting team was manually matching these data sets in a 3-way match. Because of the high volume of transactions, the process was time-consuming, the risk of human error was high, and managing discrepancies was difficult. If there was a discrepancy, it was virtually impossible to tie the general ledger transaction back to the order placed in the POS (and even more difficult when the order was placed via third-party service). After implementing Adra Matcher, the company has automated these matches, resulting in a shorter close process and decreased risk with the elimination of human error potential.
We have a ton of cash-heavy stores and that process was a huge hassle for us to manually track, so having Adra to automate that process has been a significant win for us. Our overall process has sped up considerably which has allowed us to spend more time on analyzing the data.”
Multi-Way Matching in Retail
One of the companies that also recently implemented Adra Matcher is Hobbycraft, a retailer that operates both brick and mortar stores and an e-commerce site. The accounting department must check for discrepancies between the transactions recorded on their ordering system, the merchant file, the bank, and their ledger.
E-commerce has an added layer of source complexities, which pushes the multi-way matching to four sources. This is common for most e-commerce organizations; accounting is performed at every step, whether it is calculating merchant fees, putting up accounts receivable, or recording revenue. Adra Matcher not only streamlines the reconciliation process but also eases the documentation for downstream accounting.
When we get to period-end, I now have the confidence in terms of knowing accounts have been reconciled – I can see the aging of accounts very easily. The team is also able to re-run the reconciliations post period-end to prove to me that all cash has matched off and then we are able to very quickly drill into where the exceptions are. The team is now focused on items that they most likely would have never had the chance to get to had this process still been conducted manually.”
Accounts Payable Use Case
Another example of multi-way matching are the payroll and accounting teams that exist in almost every organization. When teams need to be concerned with reconciling bank records, cash, payroll, accruals, currency, and much more, transaction matching can easily become an overwhelming task, fraught with opportunities for error and fraud.
Before implementing Adra Matcher, Drammen Municipality’s payroll and accounting teams would perform the manual matching process daily in Excel, and because documents were kept in disparate systems (including paper files), the matching process was time-consuming to say the least. With the implementation of Matcher, payroll and accounting departments have been able to automate their 3-way match processes. Bank data, service orders, tax income, invoices, and other reconciliations are all imported into Adra and automatically matched daily, allowing for greater visibility and time savings.
Adra is a great product that makes reconciliation of both large and small accounts much easier. There are several search options, and records that match between our accounts and bank records are automatically reconciled. This saves time. Adra Matcher is the best matching tool I’ve used. There is a reason why our city has had the product for 20 years.”
Streamline Complex Reconciliations with Automated Multi-Way Matching
Whether your organization faces similar challenges or those unique to your industry, automated multi-way matching can benefit complicated reconciliation processes. By automating the entire process, you will reduce your time to complete the reconciliation and also the inherent risk associated with a multi-way matching scenario.
Written by: Nicole Tallman
