As the year-end approaches, closing the financial year involves more than just reconciling numbers. One important step still lies ahead – requesting confirmation letters from banks!
According to the guidelines of the Accounting Standards Board, every accounting entity must ensure that the information presented in the annual report is fair and reliable. This also includes confirmations issued by banks regarding account balances, loans, collateral, and other financial assets and liabilities.
It’s important to understand that banks experience a significantly higher workload at the end of the year and the beginning of the new one. They receive a large number of similar requests from many companies. If you wait until the last minute to request confirmation letters, the response time may lengthen, causing delays in preparing the annual report. This, in turn, increases the risk that banks will not be able to confirm important balances on time, potentially slowing down both financial reporting and the audit process.
By acting early, companies can receive bank confirmations more quickly and identify any discrepancies in account balances or loan agreement terms ahead of time. This allows sufficient opportunity to request clarifications or correct data before the audit or reporting process reaches full speed.
Bank confirmation letters should not be requested when the deadline is already looming — they should be requested while there is still time.
To stay informed about economic developments, legal updates, and key trends in our services, subscribe to our newsletter.
