This guide provides an example of how a company might reconcile an accounting period in TBN. Since each company has its own accounting practices, this is not intended as a definitive process for everyone. Instead, it demonstrates how to locate the necessary data to meet your specific requirements. This guide is designed for companies that invoice all payments in TBN. While not required, TBN believes this is a best practice. 

This guide outlines the standard Month End Close and Reconciliation Process for companies that invoice all revenue in TBN. The goal of this process is to ensure that Revenue, Cash, AR, Credits, and Unearned Revenue all reconcile and tie together at the end of each accounting period.

This process should be completed after all invoices for the period have been created and before the accounting period is closed.

Overview of Month-End Reconciliation Sections

The Month End Close consists of the following reconciliations:

1. Total Revenue Reconciliation

2. Customer Credit Audit

3. Unearned Revenue Calculation

4. Customer Credit Transaction Audit

5. Net Cash Received Calculation

6. AR Aging Audit

• Reports to run

• Steps to calculate totals

• What the numbers should equal

1. Total Revenue Reconciliation

Purpose

This reconciliation ensures that all revenue recorded in the GL matches invoiced revenue for the period.

Reports to Pull

Run the following reports for the period you are reconciling:

• Taxes Charged Report

• GL Revenue Entry Report

• Invoices Total Report

Steps

1. Pull Taxes Charged for the period.

2. Pull GL Revenue Entry Report for the period.

3. Add the two together:

Taxes Charged + GL Revenue Report = Total Revenue

4. Pull the Invoices Total Report for the same period.

Final Check

Total Revenue should equal Invoices Total Report

If these numbers do not match, it means:

• Revenue was recorded without an invoice

• An invoice exists without revenue

• Taxes were not included in the reconciliation

2. Customer Credit Audit

Purpose

This ensures that the change in total customer credits matches the credits issued during the period.

Reports to Pull

• Credit Balance Report Close of Last Period

• Credit Balance Report Close of This Period

• Customer Credit Report for This Period

Steps

Calculate the change in credit balances:

Credit Balance (This Period Close)
MINUS
Credit Balance (Last Period Close)
=
Customer Credit Report Total (This Period)

If this does not match, then:

• Credits were manually created incorrectly

• Refunds were processed incorrectly

3. Unearned Revenue Calculation

Purpose

Unearned Revenue represents money received but not yet invoiced.

Part of the process of invoicing every payment workflow is that revenue is realized at "invoice date". In the case of companies who are accustom to realizing revenue at departure or return, the process of invoicing will allow you to set the date of the invoice to those respective dates. This means the net effect of this invoice flow does not materially change your revenue realization strategy. 

For companies who are invoicing every payment you will NOT use the unearned revenue report. This calculation is how you establish your Unearned Revenue. It is not intended to audit against the report titled "unearned revenue" 

Reports to Pull

• Un-Invoiced Payments Report (Close of Period)

• Customer Credit Report (Close of Period)

Steps

Un-Invoiced Payments + Customer Credit = Unearned Revenue

This number represents all money held by the company that has not yet been recognized as revenue.

4. Transaction Report – Customer Credit Audit

Purpose

This audit ensures that Customer Credit transactions match issued credits, excluding manually created credits.

Reports to Pull

1. Transaction Report for the period

   • Filter Transaction Types:

     • Customer Credit

     • Refund as Customer Credit

2. Credits Report

   • Filter: Show Only Issued Credits

3. From the Credits Report:

   • Filter all "Manually Created Credits"
     

   • Filter to only show "overpayment" credits
     

   • Sum the amount of manually created credits

Calculation

Issued Credits − Manual Credits − Overpayment Credits = Transaction Report Total

This confirms that the system-generated credits match transaction activity.

5. Calculating Net Cash Received

Purpose

This calculation determines actual cash received during the period, excluding credits and credit refunds.

Report to Pull

Run Transaction Report for the period with the following filters:

Exclude transaction types:

• Customer Credit

• Refund as Customer Credit
  

• Refund

Result

This report total = Net Cash Received in the Period

This represents actual money collected (cash, check, credit card, ACH, etc.).

6. AR Aging Audit

Purpose

This audit confirms that Accounts Receivable movement matches invoices and payments applied to invoices.

Reports to Pull

• AR Aging Close of Last Period

• AR Aging Close of This Period

• Invoice Report for the Period

• Voided Invoices Report

  • Invoice Date in Period

  • Voided After Period

• Transaction Report (filtered as described below)

Step 1 — AR Aging Anchors

Record:

AR Aging Close of Last Period = Opening AR
AR Aging Close of This Period = Closing AR

These numbers come directly from the AR Aging report.

Step 2 — Adjusted Invoice Total

Calculate:

Adjusted Invoice Total = Invoices for Period + Voided Invoices

Voided invoices are included because AR Aging is point-in-time.

At the close of the period, those invoices still existed and were included in AR.

Step 3 — Transactions on Invoices

Calculate:

Transactions on Invoices =
AR Opening Balance
+ Adjusted Invoice Total
- AR Closing Balance

This represents all payments applied to invoices during the period, including:

• Payments collected before the period

• Deposits linked to invoices created during the period

• Payments collected during the period

Step 4 — Transaction Report Audit

Run Transaction Report twice and Free entry Discrepancy Report once:

Report 1

• Transaction Date = Period Dates

• Invoice Date = Period Dates

Report 2

• Transaction Date = Any Date Before Period End

• Invoice Date = Period Dates
  

Final Audit

Report 1 Total + Report 2 Total = Transactions on Invoices

If these numbers match, AR has been reconciled correctly.

Final Notes

• Revenue matches invoices
  

• Credits reconcile

• Unearned revenue is accounted for

• Cash received is calculated

• AR movement reconciles

• The mentioned reports tie together
  

If all reconciliations balance, the accounting period can be considered closed and accurate.