Ken Valentine, now Fifth Third Bank Vice President and Senior Group Manager, Information Technology, joined the bank in 2003 for the sole purpose of automating reconciliation. Fifth Third Bank places a high value on the visibility, control and time-savings that automation brings, and so does Valentine. He had previously worked for several years as a consultant helping banks implement accounting-related systems.

Valentine explained, “When a financial institution grows, it needs automation to reconcile accounts in an easily auditable, cost-effective way.”

In evaluating reconciliation solutions for Fifth Third Bank, Valentine chose Fiserv because of its solid reputation in financial services and for the partnership opportunity Fiserv offered. “I had a voice in creating the reconciliation solution,” he said. “I had a constant dialogue with Fiserv and other users. We would suggest enhancements based on our needs as well as regulatory changes. The people at Fiserv really listened to us.”

The goal in implementing Frontier Reconciliation was to centralize and standardize the reconciliation process across Fifth Third Bank so reconciliations could be easily tracked in one place. “Reconciliations were done by four to five decentralized groups. But we wanted one primary system for standardizing reconciliations and improving visibility into data,” Valentine said.

The bank identified and included account reconciliations enterprise-wide, such as demand deposit accounts (DDA), general ledger, trust ledger and securities. The bank has since added checks and other payment types.

“We have 98 percent of our balance sheet on Frontier Reconciliation,” Valentine said. “There are 17,781 accounts being reconciled by 37 daily reconcilers (centralized) and 26 accounting reconcilers (month-end only). Automation enabled us to reallocate 125 full-time employees who had been doing reconciliations under the decentralized, manual process.”

With the segregation of duties within Frontier Reconciliation, users cannot manipulate data and results like they can in an Excel spreadsheet. This provides protection against fraud and misstatements.

“Auditors can see that all reconciliations are occurring, that the bank is doing true exception management and charge-off management. It verifies segregation of duties.,” Valentine said.

Valentine challenges other financial institutions who are not automating reconciliation. “Ask yourselves why not automate? Why would a manual process be better than an automated process?'"

Valentine added, “If you’re using an automated solution like Frontier Reconciliation, you can be certain you have strong internal controls that meet regulatory requirements such as Sarbanes Oxley. With Frontier Reconciliation, Fifth Third has achieved incredible operational efficiencies.

“If you have any kind of appreciable volume, I don’t know how an organization can perform true exception management through manual reconciliation.

“If you’ve got hundreds of thousands of transactions per day, it’s a lot of work to load them all onto a spreadsheet, making sure to get the right balances, making sure you get everything matched up. I’ve got to believe the risk is high in those areas that are manual.”