ACCOUNT RECONCILIATION PROJECT

Project Scope:

The parent company was preparing for the sale of its manufacturing division. The parent company’s internal auditors had recently uncovered significant findings related to balance sheet reconciliations and erroneous reporting. Concurrently, a new CEO was increasingly concerned with the accounting data he was receiving.

Because the company did not have the technical expertise or resources needed to conduct a thorough review, management engaged Horn Solutions to conduct a comprehensive examination of the company’s balance sheet reconciliations, identify necessary adjustments, and recommend a standardized, sustainable approach going forward.

Project Approach:

In order to accomplish such a comprehensive account reconciliation project, Horn Solutions designed and implemented a targeted, risk based approach which:

  1. Identified the total population of general ledger accounts and prioritized their materiality and risk, using both feedback from the client and Horn Solutions’ risk assessment tools and techniques.

  2. Assessed the quality of the existing reconciliations based on a series of predetermined attributes such as timely completion, evidence of supporting documentation, review and approval, and resolution of reconciliation discrepancies.

  3. Used automated processes and software, including Microsoft Access, to assist in the reconciliation of data intensive accounts.

  4. Analyzed and tested each reconciliation, scored its overall accuracy, timeliness, and completeness, and presented executive level findings to management.

  5. Proposed adjustments, as needed.

Project Benefits/Savings:

Horn Solutions produced multiple, tangible benefits for the company through this project.

  1. The company obtained accurate account balances critical in establishing the sales price of the subsidiary unit.

  2. The completion of a substantial amount of due diligence work in advance of the sale.

  3. Business processes at the company were significantly improved. For the first time, the company had the ability to reconcile primary cost accounts at a level sufficiently detailed to identify the cause of differences between the general ledger and sub ledgers.

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