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AI-Powered Bank Reconciliation - User Guide

Version: 1.0.0
Last Updated: 2026-02-16
Status: Active
Module: FA (Finance & Revenue)

Cross-References:

• Bank Reconciliation Wizard - Base reconciliation workflow
• FA Module Settings - Configuration reference
• FA Security Considerations - PHI/PII protection

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Overview

FA-28 extends the bank reconciliation module with AI-powered features that automate transaction categorization, suggest matches between bank and GL lines, detect anomalies, and provide a reconciliation dashboard. All AI features are disabled by default and create draft journal entries only — never auto-post.

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Feature Summary

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Enabling AI Features

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Prerequisites

• Org Admin or user with fa.reconciliation.ai.configure permission
• AI Gateway enabled (LOVABLE_API_KEY provisioned)

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Configuration

1. Navigate to Finance > Settings
2. Click the Matching & AI tab
3. Toggle features on/off:
   • AI Categorization — Automatically suggest GL accounts for bank lines
   • AI Smart Matching — Pair unmatched bank and GL lines using AI
   • Anomaly Detection — Flag suspicious transactions
4. Adjust confidence thresholds:
   • Categorization Auto-Apply Threshold (default: 0.85) — Suggestions above this create draft JEs automatically
   • Matching Auto-Apply Threshold (default: 0.90) — Matches above this are applied automatically
5. Click Save

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AI Transaction Categorization

When enabled, AI categorization runs automatically after the deterministic rule engine during Plaid sync. It processes unmatched bank lines that were not caught by existing rules.

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How It Works

1. Unmatched bank lines (no rule match, no existing JE) are batched
2. AI analyzes transaction descriptions, amounts, dates, and Plaid categories
3. Each line receives a suggested debit/credit account with a confidence score (0-1)
4. Lines above the auto-apply threshold get draft journal entries created automatically
5. Lines below the threshold show as suggestions for manual review

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Reviewing AI Suggestions

In the Unmatched Bank Lines table:

• Lines with AI suggestions show a sparkle icon and confidence percentage
• Hover to see the AI’s reasoning
• Click Accept to create a draft journal entry
• Click Create Rule to create a reusable transaction rule from the suggestion
• Click Reject to clear the suggestion

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Security

• Only transaction descriptions, amounts, dates, and Plaid categories are sent to AI
• No account numbers, names, SSNs, or other PHI/PII are included in AI requests
• All created entries are drafts requiring manual posting

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AI Smart Matching

AI matching pairs unmatched bank lines with unmatched GL entries using pattern recognition.

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How It Works

1. After deterministic matching completes, AI analyzes remaining unmatched items
2. AI considers descriptions, amounts, dates, and patterns to suggest pairings
3. High-confidence matches (above threshold) are applied automatically as ai_auto
4. Lower-confidence suggestions appear as ai_suggested for manual review

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Reviewing Match Suggestions

In the Unmatched Transactions tab of reconciliation detail:

• AI-suggested matches appear in the AI Match Suggestions section
• Each shows the bank line, matched GL entry, confidence score, and reasoning
• Click Accept to confirm the match
• Click Reject to remove the suggestion
• Use AI Match All (N) button to bulk-accept all suggestions above 80% confidence

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Anomaly Detection

Statistical analysis flags potentially suspicious transactions.

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Detection Types

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Viewing Anomalies

• Flagged transactions show a warning badge with severity color
• Hover for detailed anomaly information
• Anomaly scores range from 0-100 (higher = more suspicious)

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AI Reconciliation Assistant

The inline AI assistant provides contextual help within the reconciliation detail view.

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Using the Assistant

1. Open a reconciliation detail page
2. The AI assistant panel appears below the header (when enabled)
3. Type questions or use quick prompts:
   • “Why is this unmatched?”
   • “Show bank fees”
   • “Explain the difference”
4. The assistant has context about the reconciliation’s balances, status, and discrepancies

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Privacy

• Only aggregated balances, counts, and descriptions are shared with AI
• No PHI/PII is included in assistant context

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Reconciliation Dashboard

The dashboard provides aggregated metrics across all reconciliations.

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Dashboard Cards

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Accessing the Dashboard

• Navigate to Finance > Reconciliations
• The dashboard appears at the top of the page (collapsible)
• Click Show/Hide Dashboard to toggle visibility

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Troubleshooting

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AI Features Not Working

1. Verify AI features are enabled in Finance > Settings > Matching & AI
2. Confirm you have fa.reconciliation.ai.use permission
3. Check that the AI Gateway is provisioned (LOVABLE_API_KEY)
4. AI features degrade gracefully — the deterministic pipeline is unaffected

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No AI Suggestions Appearing

• AI only processes lines not already matched by rules or manual matching
• Check that bank lines exist without rule_id or auto_journal_entry_id
• AI categorization runs during Plaid sync; manual trigger available via hook

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Anomaly Scores Seem Incorrect

• Anomaly detection uses statistical analysis based on historical transaction data
• New organizations with limited history may see more “unknown merchant” flags
• Scores improve as more transaction history accumulates

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Related Documentation

• Bank Reconciliation Wizard - Base reconciliation workflow
• Plaid Setup - Bank connection configuration
• FA Module Settings - All FA configuration options
• FA Security - Security and compliance

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Version History

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1.0.0 (2026-02-16)

• Initial release: AI categorization, smart matching, anomaly detection, assistant, dashboard

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Last Updated: 2026-02-16