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Agnostic Finance
Use Case

Reconciliation of Tax Balance Sheet Accounts

An AI agent that automates the reconciliation of tax-related balance sheet accounts (e.g., income taxes payable, deferred tax assets/liabilities) by comparing balances between the general ledger, tax provision software, and supporting tax calculations/schedules, identifying discrepancies, and gathering initial supporting documentation.

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Process Details

Inputs

List of tax balance sheet accounts to be reconciled, GL trial balances or account activity reports, Tax provision system reports and roll-forwards

Outputs

Draft tax account reconciliation packages, List of identified discrepancies with potential root causes

Systems

ERP Systems (SAP, Oracle NetSuite, Microsoft Dynamics 365) Tax Provision Software

The Challenge

Manual processes
create real problems.

  1. 1

    High potential for costly errors from manual data handling.

  2. 2

    Significant time and resources are spent on repetitive, low-value work.

  3. 3

    The manual process is difficult to scale without increasing headcount.

  4. 4

    Process bottlenecks lead to delays and missed deadlines.

The Solution

Describe it in English.
It runs deterministically.

  1. 1

    Data Extraction

    a) extracts month-end/quarter-end balances for specified tax accounts from the ERP System's General Ledger, b) retrieves corresponding balances and detailed roll-forwards from the Tax Provision Software, c) accesses supporting tax calculation workpapers, tax payment proofs, and notices from Document Management Systems

  2. 2

    Matching & Comparison

    Compares GL balances with tax provision system balances and prior period reconciled balances. Matches detailed transactions or movements within the roll-forward to supporting documentation

  3. 3

    Discrepancy Identification & Quantification

    Identifies any differences between systems or lack of supporting documentation for reconciled items. Quantifies the discrepancies.

  4. 4

    Reconciliation Package Preparation

    Prepares a draft reconciliation package, including a summary of balances, matched items, identified discrepancies with potential reasons, and links to supporting evidence

Primary Benefits

What you gain with
Kognitos automation.

Increase Efficiency

Dramatically reduce the time and manual effort required to complete the process.

Enhance Accuracy

Eliminate human error to ensure data integrity and reduce financial risk.

Empower Employees

Free your team from monotonous tasks, allowing them to focus on strategic work that requires their expertise.

Improve Scalability

Handle growing volumes of work without a proportional increase in operational costs.

Ensure Transparency

Maintain a complete, auditable trail of every action the AI agent takes, described in plain English.

FAQ

Common questions
answered.

It integrates with major ERP systems (SAP, Oracle, Microsoft Dynamics, etc.) to pull GL data. It also connects with document management systems (e.g., SharePoint, network drives) where supporting workpapers are stored.
The Kognitos platform uses AI-powered data extraction. It can intelligently read and pull specific data points from various document types, not just structured databases.
Yes. We understand that most tax departments have standardized reconciliation templates that auditors are familiar with. The agent can be configured to populate your existing templates, ensuring the output is consistent with your internal standards and meets the specific expectations of your audit firm.
Given the complexity and sensitivity of tax data, a standard implementation takes approximately 4- 6 weeks. This involves a collaborative process with your tax team to map accounts, identify source systems and document locations, configure the specific reconciliation logic, and conduct thorough testing before go-live.
The agent handles the "what" and the human expert handles the "why." The agent prepares the draft reconciliation, flags the discrepancies, and provides all the linked documents. The tax professional's role is elevated to that of a reviewer and analyst. They review the completed package, investigate the flagged discrepancies, and use their expertise to determine the root cause and resolution.
The agent is designed to be adaptable. Through the Kognitos platform, a business user from your tax team—with minimal training—can easily teach the agent how to read a new document format or where to find information in a revised Excel template.
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Challenges

Solution

This use case solution follows these general steps at a high level:

  1. Data Extractiona) extracts month-end/quarter-end balances for specified tax accounts from the ERP System's General Ledger, b) retrieves corresponding balances and detailed roll-forwards from the Tax Provision Software, c) accesses supporting tax calculation workpapers, tax payment proofs, and notices from Document Management Systems
  2. Matching & ComparisonCompares GL balances with tax provision system balances and prior period reconciled balances. Matches detailed transactions or movements within the roll-forward to supporting documentation
  3. Discrepancy Identification & QuantificationIdentifies any differences between systems or lack of supporting documentation for reconciled items. Quantifies the discrepancies.
  4. Reconciliation Package PreparationPrepares a draft reconciliation package, including a summary of balances, matched items, identified discrepancies with potential reasons, and links to supporting evidence

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