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Good morning,
I would like to know, why reconciling statements to ledger balances would not be an effective test on receivables. Are we talking about statements received from the customer or statements in the clients records?
Thank you in advance
Customers do not send statements, suppliers do. In this case we are the supplier and we would send statements to our customers (receivables). However, the statement is really just a snapshot of the receivable account so we are really comparing exactly same pieces data so nothing is gained.
Had it been a payables balance we were trying to verify, then the supplier could have sent us a statement (a snapshot of our account with the supplier) then we could compare that to our version of the account on our payables ledger to see if there were unexplained differences.
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