Cross-Border Payment Reconciliation Challenges

Cross-border payments are the "Final Boss" of reconciliation. Unlike domestic ACH, where $100 sent is $100 received, international wires traverse multiple banks, each potentially taking a "Lifting Fee" from the principal. A reconciliation engine looking for an exact amount match will fail 100% of the time. The system must implement "Gross Up" logic to account for the missing money.

The Fee Types: OUR, BEN, SHA

The SWIFT instruction defines who pays the fees:

OUR: Sender pays all fees. Beneficiary receives full amount. (Easier recon).

BEN: Beneficiary pays all fees. Intermediaries deduct from principal.

SHA: Shared. Sender pays sending bank; Beneficiary pays receiving bank.

The Logic: If the system expects a $5,000 deposit but receives $4,975, the matching algorithm must check the fee flag. If SHA or BEN, it should categorize the $25 variance as Lifting_Fees (Expense) and match the transaction, rather than breaking it.

The "Gross Up" Accounting Pattern

To reconcile a net receipt against a gross invoice, the ledger must "Gross Up" the entry.

Bank Feed: Credit $4,975.

Invoice: Open Receivable $5,000.

Automated Journal:

Debit Cash: $4,975

Debit Bank Fee Expense: $25

Credit Accounts Receivable: $5,000

This clears the invoice fully despite the cash discrepancy.