Reconciliation Statement

How to Prepare Bank Reconciliation Statement

  • First, you need to keep check on bank books and opening balance of the bank that it matches the balance of last reconciliation.
  • Check all the entries carefully
  • Check pending entries in last reconciliation and tick them.
  • Now, let’s go handy with pen and paper, note down all the non-ticked list in one paper.
  • Now, add the cheque’s amount which not presented for payment.
  • Add the amount that the bank has credited in your account.
  • Add the amount that is dishonored by the bank.
  • You also need to add the amount that is not cleared.

Now, subtract the amount dishonored by bank and deposited directly.

Ideally, reconciliation statement refers to a summary created comprising the activities related to the banking and business that reconciles an entity’s bank account with all the financial records. The reconciliation statement outlines the deposits, withdrawals, and other activity that affects a bank account for a time period set. This statement is is very helpful in controlling internal finance control tool used to stop any sort of fraud.

A reconciliation statement are generated built in the below mentioned scenarios:

Prepare Company Bank Reconciliation Statement
Prepare Company Bank Reconciliation Statement

Bank Accounts: Usually the bank reconciliation analyzes the company cash and bank balance with the reconciling items like: deposits in transit and uncashed checks. The bank reconciliation accorded as a module within an accounting software of the company.
Debt Accounts: This reconciliation is analyzes the debt amounts superior to the company and its lender. The differences can demand reconciliation when the company pays the lender, and the lender has not yet entered the payment into the books.
Accounts Receivable: The A/R reconciliation is built informally for independent customers, and analyses the version of outstanding balances of the receivable to the version of the company.
Accounts Payable. The A/P reconciliation is designed on a informal basis by an individual supplier, and compares their version of outstanding payable balances to the version of the company.

The reconciliation statements are also important for identifying the difference in timing of the similar transaction that is recorded for both parties. The reconciliation statements also are important for sorting out the differences between the amounts recorded for a transaction, that are needed for adjustments by either party to edit the recorded balances.

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