How To Do Bank Account Reconciliation?

As you have probably gathered by now, there are a few documents you must have nearby if you’re going to attempt to do your own reconciliation process. The first item you should have is an itemized bank statement outlining all of your transactions. A bookkeeper or an accountant will go through this process every month to keep up with your activity, but you can also do it every few months or once a year when the tax season comes.

However, the less often you do it, the more difficult it will be for you to do it. Not to mention that the chances of error are also multiplied. Here at ProLedge, we know very well how important it is to be consistent and thorough in your activity and documentation, especially when it comes to numbers. So, if you want the expert’s advice, that would be to do it as often as possible and to check your numbers not only once, but twice. You can never be too careful in accounting, especially when it comes to bank reconciliation.

Once you have the bank statement, the next document you should prepare is your cash book, or the accounting software that you use to keep track of your ins and outs.

Now, if you do this monthly, or at least multiple times a year, you should also have previous accounts near your work station, so that you can refer to them when needed.

Here are some tips on how to ensure you’re maximizing your chances of success, while minimizing the chances of errors:

• Have it all near you before you start
• Make sure the statements are organized
• If you’re using a software, make good use of the smart features it has
• Set a monthly alarm (or weekly) to make sure you don’t skip a month by accident
• Write a checklist to keep you organized
• If time allows, match the transactions in small batches in order to avoid errors
• Review the bank statement carefully to make sure you catch any unauthorized transactions
• Keep copies of the receipts, invoices and payment confirmations