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Purpose and Flow of Tie Outs

The purpose of a tie out is to ensure all balances per the financial statements and trial balance match the underlying accounting detail and schedules.

For example, if you are performing a tie out of fixed assets, you will likely receive the fixed asset register and fixed asset rollforward. The fixed asset register is a listing of all details and activity that occurred during the respective period. These details get summarized in the fixed asset rollforward (i.e. total additions, disposals, transfers, depreciation), which generates balances that will appear in the trial balance.

For any tie out, you ultimately want to agree totals from the most granular source detail (i.e. transaction listing) to the summary accounting schedule, then agree those numbers to the trial balance, and then agree the trial balance to the financial statements.

In the case of fixed assets, the transaction listing is the fixed asset register and the summary schedule is the fixed asset rollforward. These balances should agree with the trial balance and the financial statements.


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