Bank reconciliation is the process by which an entity’s accounting record for a cash account is reconciled with its bank statement and it should be completed at regular intervals for all bank accounts.
Here are 4 steps for completing bank reconciliation
1
Match the deposits
Get the bank and business records, compare the amount of each recorded deposit in the debit column of your cashbook with the credit side of the bank statement. Also, you will need to access your company’s ledger or books.
2
Bank statement adjustment
Some times when a bank statement will fail to accurately reflect on transactions, this could be caused by bank errors, outstanding checks or pending deposit which changes have to be done on the bank statement.
3
Cash account adjustments
The bank adds its own fees and interest that must be recorded in a company’s books as well. Add any interest earned and notes receivable amount. You must also deduct any monthly service charges, overdraft fees, and accounting errors.
4
Weigh up the balance
For a business to succeed, it must know its target audience. What kind of consumer they’ve and why do people shop at their competitor store. To know your target audience, you need to examine your current base. The more surveys you carry out, the better marketing campaigns you can create.
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