What is Bank Reconciliation?

Question

Accepted Answer

Bank reconciliation is the process of comparing a company's records with those of its bank to ensure they match.

Bank reconciliation involves comparing the company's cash balance in its accounting records with the balance shown on the bank statement.
Any discrepancies between the two balances need to be investigated and resolved.
Common reasons for discrepancies include outstanding checks, deposits in transit, bank fees, and errors in recording transactions.
Once all discrepancies are identified and resolved, the company's cash balance should match the bank's balance.
Bank reconciliation helps ensure the accuracy of a company's financial records and detect any errors or fraudulent activities.

Accepted Answer

Bank reconciliation is the process of comparing a company's records with those of its bank to ensure they match.

Bank reconciliation involves comparing the company's cash balance in its accounting records with the balance shown on the bank statement.

Any discrepancies between the two balances need to be investigated and resolved.

Common reasons for discrepancies include outstanding checks, deposits in transit, bank fees, and errors in recording transactions.

Once all discrepancies are identified and resolved, the company's cash balance should match the bank's balance.

Bank reconciliation helps ensure the accuracy of a company's financial records and detect any errors or fraudulent activities.

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