FinRCA-Bench: Benchmarking Evidence Retrieval and Reasoning for Financial AI Systems

Abstract

Large language models are increasingly used to support financial operations, but their apparent reasoning performance can depend on whether they receive the right evidence. In financial reconciliation, the evidence needed for diagnosis is distributed across invoices, purchase orders, approvals, allocations, payments, ledger entries, and bank activity, linked by transactional relationships rather than textual similarity. End-to-end accuracy can therefore conflate evidence access with reasoning quality. We introduce FinRCA-Bench, a deterministic synthetic benchmark of 2,250 accounts-payable-to-bank reconciliation cases spanning 14 operational tables, including 1,500 injected failures across 15 causal categories and 750 legitimate or hard-negative cases. Root-cause labels and record-level evidence contracts are hidden from the model, allowing retrieval to be evaluated independently of answer correctness. We compare Rules/SQL, classical machine learning, dense semantic retrieval, deterministic relational expansion, and Typed Provenance Graph Retrieval (TPGR), a typed traversal restricted to persisted transaction relationships. Rules/SQL reaches 84.97% held-out exact accuracy and classical ML reaches 95.44%. Holding the reasoning model, prompt, and generation settings fixed while changing only retrieval increases macro required-record recall from 0.83% to 77.70% and exact 16-class accuracy from 2.05% to 72.44%. Structural retrieval failures outnumber reasoning failures with sufficient retrieval by 95 to 15; 254 correct predictions occur despite incomplete retrieval, and strict returned-evidence contract accuracy is only 5.72%. On FinRCA-Bench, retrieval architecture strongly shapes observed AI-system performance, and a correct root-cause label is a weak proxy for an auditable diagnosis.