Ads end in 20 seconds
This content is free thanks to our sponsors
Sponsored Ad – I may earn a commission if you click and buy
Accounting
Bank Reconciliation
The process of matching your company's cash records with the bank's official statement to catch mistakes or missing items.
Bank reconciliations catch errors, forgotten fees, or deposits in transit. You start with the bank balance, add deposits not yet recorded by the bank, subtract checks not yet cleared, and adjust for bank fees or interest. The final number should match your books.It's like checking your phone's text messages against your friend's phone to make sure you both saw the same conversation.
Real world: At the end of the month your business checkbook says you have $8,200 but the bank statement says $7,900 — you reconcile to find the $300 check that hasn't cleared yet.
💡 Do a bank reconciliation every month — it's the easiest way to spot theft, mistakes, or forgotten transactions before they become big problems.