How to check loans between associated entities agree

A family group lends money to itself all year. The company owes the trust, the trust owes the director, and each entity's books say what they say. At year end, the loan in one ledger should be the exact opposite of the loan in the other, and finding out it isn't, in the middle of signing off, is nobody's idea of a good afternoon. Check associated does the comparison for you, across your client ledgers.

Running the check

1. Open the Balance Sheet or Sub Accounts for a ledger.
2. Click Check associated beside the loans account.
3. Read the results. A pill at the top reads All OK or the number of errors, then each sub-account is listed under To fix or check or Matched.
4. Click a ledger's name to open that ledger's Balance Sheet at the account, on the same period, and look into it.

Results stay available from the Results button, so you can come back to them while you work through the list.

What it tells you

• Values match - the other ledger shows the exact opposite amount.
• Out by - and by how much, so you know what you are looking for.
• Wrong side - a debit where a credit should be.
• Nothing in - the other ledger has no matching balance.
• No matching ledger - no client ledger of yours matches this sub-account's name.

What you need

The check appears on accounts named for associated entities, related parties or inter-company loans. It uses your firm's own AI key, already set for AI Analysis, to match each sub-account's name to a client ledger. Only names are sent, not amounts, and nothing is written to any ledger.

Use it with judgement

Check associated compares balances: it finds what doesn't agree, quickly. A match is a good sign rather than a reconciliation, so you still sign off on the loan as you always have. What it removes is the hours of opening ledger after ledger to find which of them needs your attention.

Before you consolidate

If those entities are consolidated, this is the right first step. An intercompany loan has to agree before it can be cleanly eliminated, so run the check, fix what's out, and then post your eliminations.

Watch the Check associated how-to video.