Bank Reconciliation

Question 1

What is bank reconciliation?

Answer 1

A bank reconciliation statement compares the cash balance on a company’s balance sheet to the corresponding amount on its bank statement

Question 2

First step in bank reconciliation

Answer 2

Get bank records - List of transactions from the bank

Question 3

Second step in bank reconciliation

Answer 3

Get software records - Open ledger of income and expense

Question 4

Third step in bank reconciliation

Answer 4

Find starting point - last time the balance on software was the same as the balance in the bank account

Question 5

Fourth step in bank reconciliation

Answer 5

Run through bank deposits - Each deposit appears as income in your accounts

Question 6

Fifth step in bank reconciliation

Answer 6

Check the income on books - Each income entry matches deposit on my bank statement

Question 7

Sixth step in bank reconciliation

Answer 7

Run through bank withdrawals - bank fees should be recorded

Question 8

Seventh step in bank reconciliation

Answer 8

Check the expenses on books - Each expense entry should match a withdrawal on the bank statement

Question 9

Eighth step in bank reconciliation

Answer 9

End balance - After all the deposits and withdrawals, your business bank balance should match the totals in your business accounts.