Business owners often double-check their records with bank transactions to ensure accuracy. Verifying that the balance sheet and bank statement numbers are correct is good practice. The balance sheet is adjusted accordingly if any anomalies or fraudulent charges are discovered. But sometimes, the owners need help with the organization’s financial part properly. Accounting outsourcing is undeniably the best option for businesses as it not only streamlines their financial operations but also prevents potential financial issues in the future.

Monthly reconciliation is performed to keep the balances of the two records in check. Bank reconciliation also highlights significant differences that, when eliminated, could benefit a company. If you need to learn how to do the bank reconciliation statement, you have come to the right place. We will help you in this process. Are you ready to know about it? Let’s start with the topic.

Ways You Can Do Bank Reconciliation Statement 

Document the process

Keeping track of the reconciliation method is crucial for checking errors and corrections to the management team later. Documentation also helps non-reconciliation employee’s cross-check data and refers back to source documents.

Check all your uncleared dues

Start by comparing the opening balances of the bank statement and the cash book’s bank column. The two may differ when it comes to unpaid balances, such as unpresented or uncredited checks from the prior month.

Adjust your bank statement

It would help if you made a few adjustments to reconcile your bank statement. Firstly, add any deposits in transit – these are the amounts you have deposited into your account but have yet to be recorded by the bank. Secondly, deduct any outstanding checks – these are the ones you have written but still need to clear your bank account. Finally, add or deduct any bank errors – these are mistakes that the bank might have made while creating the statement. Once you have made these adjustments, you can balance your bank statement.

Check all the expenses

Verify that every transaction is accurately recorded in your books by comparing them to the bank statements. Determine the reason for any mismatched items, if there are any. You may have forgotten that you paid cash for something, or a payment hasn’t cleared yet.

Standardize the workflow

Reconciliation can be standardized with stages to follow, which can streamline the procedure and save time. You can accomplish this by utilizing a software tool or making a checklist.

Check for any missing entries

Examine the entries in the checkbook and the cash book’s bank column. Look for records in the cash book’s bank column that still need to be posted. List each of these things separately and enter it in the cash book.

Adjust the bank statements

A bank statement may occasionally need to depict the transactions of a business correctly. Checks still outstanding, bank mistakes, or deposits still being processed are common culprits. For whatever reason, adjust the bank statement as needed.

Always compare the last balance

It would help if you verified that the end balances are the same after you have compared the records and made the necessary adjustments. At this point, the reconciliation procedure should be finished. You’ll have to go through the steps again to determine the mistake if they still need to be equal.

These practical and effective tips can help you streamline your bank reconciliation statement. However, managing your finances involves more than just reconciling bank accounts. It requires analyzing financial data, forecasting future trends, and making intelligent financial decisions. If you need help with these responsibilities, consider hiring a virtual chief financial officer who is an expert in these areas. With their help, you can confidently navigate your financial landscape and make informed decisions that benefit your business.