The system guarantees integration between the subledgers (Accounts Receivable and Accounts Payable) and the General Ledger. When you post to a customer or vendor account, the system posts to the corresponding reconciliation account in the General Ledger automatically. As a result, totals from subledgers do not have to be transferred to the General Ledger prior to preparation of the financial statements.

The usual reconciliation accounts are:

• Domestic payables or receivables
• Payables to or receivables from affiliated companies
• Foreign payables or receivables

The following figure illustrates:

Posting to subledgers automatically results in a posting to reconciliation accounts in the General Ledger.