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Bank Reconciliation

Accounting and Reconciliations

Finance management is a close task for a management in utilising funds. Knowledge of the available funds for disposal for business requirements at finger tips on a daily basis is desirable for proper finance management. Bank Reconciliation statement does exactly this for a finance manager.

Bank Reconciliation Statement is where the client matches the bank statements of the organisation to the general ledger. The preparation of the bank reconciliation statement helps in avoiding any chances of occurrence of possible errors or mistakes in transactions or bookkeeping.

Profito Global will require the client to provide bank and cash ledgers of their business for the preparation of the bank reconciliation statement. 

An example of a possible error that occurs while preparing a ledger is:

When the client purchases goods from the supplier, the supplier is given a post-dated cheque. The client enters the transaction in their books of accounts on the date of the cheque but if the supplier deposits the cheque on a later date, a difference will arise between the books of account and the bank statements. Such differences can be analysed and corrected with the help of a bank reconciliation statement.

The benefits of preparing a bank reconciliation statement will be:

  • The bank reconciliation statement ensures accuracy in transactions entered in the general ledger of the company.
  • It helps in avoiding fraud before it's too late.
  • It helps in identifying the delays in cheque clearing.

The preparation of bank reconciliation statements should take place on a regular basis to avoid the maximum percentage of frauds committed in the business. 

Profito Global's expert team of professionals will be able to provide with best services concerning the preparation of bank reconciliation statements if the client provides all the necessary documents. Effective preparation of bank reconciliation statements and pointing out any errors or frauds will be done efficiently by the Profito Global experts.

  • ​​​​​​Bank reconciliation statements help you identify if there are any gaps between the books of accounts and bank statementsand help to pinpoint the same. Reconciling the bank and cash statements on a daily basis by the accountant is an important task so that all the mistakes can be rectified at an earlier date. Bank reconciliation statement bridges the gap between the bank account maintained in the organisation with the actual bank statements.

  • A bank reconciliation statement is a tool that helps rectify the differences between bank statements and the general ledger. Bank reconciliation helps in putting down payments that have been processed or cash receiptsthat have been deposited and comparing them with respective records in the business. It gives a deeper clarity on the allocations of funds which helps track the outflow and inflow of funds.  Organisationsmaintaining more than one bank accountbenefit majorly from the bank reconciliation statements. 

     

     

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