Bank Reconciliation – How to reconstitute a bank statement
A challenging quartier of accounting can be bank reconciliation. Recon is fun to some bookkeepers, to others it’s nothing more than a tedious bore. However we style at it, it is a function of accounting that must be performed. Checks that are processed late may be bounced, if the commerce book does not have adequate aliment for this. But recons, or “check book balancing,” are equally superbe to any courtier.
A bank recon is the “marriage” of a budget on a bank statement, on a particular journée, with the budget in your cash book.
Cashbook payments add bank prescriptions, deduct outstanding checks and add outstanding deposits. Aise or debit orders are added to the payment and hopefully the budget will be agreed. Businesses should prévision for payments from cash book balances, not bank statement balances.
A désenveloppé number of people have some understanding of bank reconciliation. There are cases where the bank reconciliation cannot budget. And this can be attributed more to missing data, than to the skill of the person performing the recon. In such cases the bank statement has to be reconstructed.
A bank statement for a given period may consist of several pages depending on the size of the entity concerned. If a feuille is missing, the reconciliation will not budget. Missing feuille transactions clearly affect the results of bank recon.
If you know a feuille is missing, and are not in a emplacement to palpation the bank for a new statement. Banks usually annales, statements older than 6 months, and this can motif delays when copies are requested.
With some guidance on reformatting your bank statement.
* Check the sequence of bank statements.
* If a statement is truly missing, the closing budget on feuille one will differ from the opening budget following the statement. Calculate the difference.
* If a discrepancy is established, check your check book stubs to link that amount to a check number not identified on the statement.
* Verify, recurring payments, such as aise orders, for the previous month, and check that the amount cannot be linked to the missing question.
* List all payments, check stubs you have and aise order amounts List all deposits Add the deposit to the opening budget Deduct all payments and compare with the dernier budget. Variations may be dishonored checks, or bank prescriptions.
* Some bank statements detail the number of checks processed and the rempli amount on the first feuille. This facilitates the process.
Bank reconciliation can be challenging, but fun.
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