Explainer library

Twelve pages on the mechanics of explaining financial change: what each analysis proves, the arithmetic written out, a worked example that ties, and the places each one reliably goes wrong. Written to be useful whether or not you ever use Valcenra.

• Account reconciliation

  Comparing a ledger balance with independent evidence, and explaining every difference between them.

• The account reconciliation process

  Seven steps, and the output each one owes the next before the reconciliation can honestly proceed.

• Balance sheet account reconciliation

  Reconciling a balance sheet account means substantiating the balance, which is a different job for each account type.

• Bank account reconciliation

  Comparing the ledger cash balance to the bank statement, and separating timing from error.

• General ledger account reconciliation

  Control accounts, subledger ties, and why agreeing two parts of one system is not evidence.

• Unmatched, unexplained and rounding

  One number called "difference" usually contains three situations that need three different responses.

• Variance analysis

  Explaining the gap between an actual result and a comparison figure, driver by driver.

• Budget variance analysis

  Comparing actual to budget, and flexing the budget so volume and efficiency stop being one number.

• Price volume mix analysis

  Splitting a revenue or margin movement into price, volume and mix effects that sum back exactly.

• Cash conversion cycle

  How many days cash is tied up between paying suppliers and collecting from customers.

• Financial statement consolidation

  Combining controlled entities into one set of statements, and the four places a plug appears.

• Month end close checklist

  The close in dependency order, with the completeness checks that make the analysis worth doing.

Why these and not others

Each page answers questions people actually search for, and each was written only where there is something specific to say. A page that could only restate a definition is not here.