18 Bank Reconciliation Examples & Templates

Bank Reconciliation Template

The bank usually carries out varying transactions daily, and you must familiarize yourself with this varying bank process, primarily the bank reconciliation. This means you should dig deeper and understand more about bank reconciliation and what it entails. The bank reconciliation template is mainly used when an error occurs between the bank balance and the company amount displayed on its accounting records.

On the other hand, it is easy to handle discrepancies issues by checking current transactions indicated on the bank statement. You can also choose to examine the company’s accounting records and tell if the two combination matches are inconsistent and require an explanation. Suppose there is no explanation for the discrepancy. You must go through the entire bank transactions and the company’s records as you match them, commencing from the last reconciliation you did. This will help you find out what specific transactions vary.

After coming up with an explanation, ensure you make the necessary adjustment in your company’s accounting records. Similarly, you can use your findings to report to your bank if necessary. Furthermore, you can achieve this better using the bank reconciliation template and the bank reconciliation forms. This will allow you to make bank reconciliations for the company often. Therefore, this article will give you an insight into the bank reconciliation template.

What is Bank Reconciliation?

Bank reconciliation is a process that explains any discrepancy within a definite date between the bank balance stated in the bank statement of the company as offered by the bank and the company’s amount displayed on its accounting records.

Bear in mind that discrepancies occur due to several reasons, such as:

  • If there has been a transaction with your bank. And has not been documented in your company’s book of records
  • The company issued checks and were not showcased to the bank
  • Errors made by your company or bank

What Is a Bank Reconciliation Template?

A bank reconciliation template is a document featuring a business and banking summary activity, which reconciles the entity of your bank account together with its financial record. Besides, it outlines withdrawals and deposits among more activities, which might impact your bank account for a specific period.

Bank Reconciliation Templates & Examples

Bank Reconciliation #01

Bank Reconciliation #02

Bank Reconciliation #03

Bank Reconciliation #04

Bank Reconciliation #05

Bank Reconciliation #06

Bank Reconciliation #07

Bank Reconciliation #08

Bank Reconciliation #09

Bank Reconciliation #10

Bank Reconciliation #11

Bank Reconciliation #12

Bank Reconciliation #13

Bank Reconciliation #14

BANK RECONCILIATION FORM

Business Accounting Basics

HOW TO DO A BANK RECONCILIATION

Monthly Bank Reconciliation

    Importance of Bank Reconciliation Template

    Companies must ensure that they run the bank reconciliation process to determine whether there is any variation between the company records and the bank transaction records in the bank statements. Likewise, there are multiple reasons why you must engage in bank reconciliation and stay informed on how to use the bank reconciliation templates. Below is an overview of the importance of a bank reconciliation template:

    • Often bank reconciliation allows for early correction and detection of mistakes, more so those made in the company records. It also acts as an indication for updating accounting records, and this applies primarily in cases where many entries are not recorded.
    • It lets you verify that the entire data in your company’s accounting records are more accurate and at par with your bank transactions. Furthermore, you can quickly examine any delays in clearing checks or even collection with the bank reconciliation template.
    • It allows you to monitor your company’s cash flow regularly. Hence, you will know if your company is progressing well or is in danger. This means you must always have someone tackling your monthly bank reconciliation, and they must be trustworthy.
    • The bank reconciliation template makes you feel secure, especially when you know your entire records match the bank statement records. This gives you peace of mind and makes you run other businesses without worrying about your company.
    • The most vulnerable asset in business is capital. Thus, bank reconciliation gives you sufficient power to oversee valuable assets that keep your company running. It helps you detect any irregularities early, such as unauthorized withdrawals from your bank. Additionally, this works if you assign different people different roles. It would help if you had individuals in charge of authorizing and accounting transactions with your bank and others responsible for preparing and maintaining the track of bank reconciliation statements.
    • It allows you to identify any errors or differences in your bank or the company records.

    These are the primary reasons you should do bank reconciliation regularly in your company. Suppose you fail to carry it out often. It will take more effort to discover and unravel many discrepancies in your entire records.

    The Main Purpose of Bank Reconciliation?

    As mentioned earlier, you must run a bank reconciliation regularly and be aware of how much funds your company has, where they are and how they are used monthly. Moreover, with an update of your cash flow, you will be able to manage your business appropriately and watch it grow magnificently. You must understand that bank reconciliation serves multiple varying purposes, among them being:

    It makes you able to review your funds or finances

    Regular bank reconciliation acts as your company’s informal review of your entire funds. When you reconcile your records, you will understand how much you spend and deposit in your account. This allows you to see your company’s cash flow and determine whether you profit or loss. This review updates you on your financial status, assisting you to manage your funds effectively.

    To enable you to run internal auditing efficiently

    Many companies and businesses use bank reconciliation regularly in their accounting and finance departments. Therefore, to ensure that your internal auditing is accurate, you must first carry out bank reconciliation, which applies to large and small businesses. Thus, bank reconciliation is part of the internal auditing process. And it helps you control your cash flow and informs you about your entire finances.

    Allows you to identify all checks that are yet to be Uncashed

    Uncashed and undiscovered checks are likely to cause significant financial issues in your company. Besides, checks can be forgotten or get lost in the email. When this happens, they will not be deposited or might end up uncashed as a payment to an individual or your account.

    By engaging in bank reconciliation often, you are likely not to experience such incidences because all your payments and deposit will be updated. In addition, Uncashed checks can make you overdraw your account, more so if you are not familiar with the potential obligations and you utilize your account statement for reference.

    Enables you to discover problems, which you are not aware of

    The bank reconciliation allows you to compare your bank account statement against the personal records of your company and figure out if there are any problems or errors. In most cases, these issues result from human errors or bank automation, and these errors include inaccurate withdrawal or deposit amounts, which might affect your financial account. Thus, regular bank reconciliation helps you identify these problems early enough and find a remedy.

    It keeps you updated about your entire bank account balance

    To determine your entire bank account balance, you must reconcile the bank account using your deposit, withdrawal, and check records. On the other hand, your bank balance statement may not showcase the payments made and have not been deducted from the posted balance. To avoid such incidences, you must be sure of your bank account balance. And you can achieve this perfectly via a bank reconciling your bank account.

    Tips for Preparing the Bank Reconciliation Form

    You might have understood the bank reconciliation template, but you are probably unaware of the tips necessary to develop the reconciliation form. Below are several tips that will guide you when using the bank reconciliation form:

    • Ensure you thoroughly inspect the bank statement balance using all the available bank statements. If you are registered online, the process can be pretty easy since you can access your bank statements and bank account faster.
    • After getting all your statements, take note of your end-month balance and confirm if the bank balance and the company account records are equal. This means all the transactions must appear on all records.
    • Bank statements refer to withdrawals from the bank account as debits, while deposits are credits. However, these terms can vary from how they will likely be used in accounting.
    • Suppose you come across transactions that are only featured on a single record, either the company or bank. This is usually considered as a reconciling item. Explain why you have such an item, make necessary corrections until all your records match.
    • Commence preparing your bank reconciliation form by adding to your bank balance any deposits that are not yet recorded due to unavoidable delays from the duration you deposited and the time the deposit was posted to your bank account as an addition.
    • Decrease your bank account balance to cover all your outstanding checks.
    • Check the previous statement of the last month to confirm that any outstanding checks from that particular month are cleared. If they have not been cleared, seek an explanation from the payee. Remember, if the checks are outstanding after a month, they might be lost.
    • Check if they are any errors resulting from the bank’s processing department, and in case of any bank transactions that seem unclear, make a point of contacting the bank.
    • If the discrepancy is not a result of a bank error and there is no explanation, fraud might have occurred.
    • To adjust your general ledger balance effectively, confirm that all checks have been deposited. After receiving your company’s bank statement, print a report showcasing that your checks of the month are written and deposited.
    • After that, examine the entire checks you have given in an orderly manner. Confirm if they have been deposited on your bank statement. If they are cleared, state that in your company records. When you are through, have a list of checks which are not featured on your bank statement, usually known as reconciling items.
    • Verify that all deposits are posted and print out a list of the deposits you made the whole month. Make sure it features deposit slips that correspond for reconciliation purposes.
    • After reviewing all your deposits, please make a list of deposits not incorporated on the bank account or statement, amount, and the date it was made. This is also referred to as a reconciling item.
    • Make sure you deduct any automated debits, fees, and service charges. These charges are usually featured on your bank statement and not on the cash account when the month ends. On your cash account records, ensure you adjust any interests, which might have been earned from the bank account balance. Automated debits, charges, and added interest amounts that do not appear on the records are referred to as reconciling items.
    • Check if you have made any mistakes during the month as you run a comparison between your company and bank records. You might come across errors you missed last time. These are also reconciling items. Then work on all these reconciling items until your entire company records match with the bank records and there are zero discrepancies.

    Key-points

    You now understand bank reconciliation’s purpose and importance with the detailed post above. This must-have convinced you to start exercising the bank reconciliation process in your company. Moreover, apart from its essentialness and purpose, it also guarantees you benefits, such as identifying errors made by the bank, avoiding overdraft, and detecting fraud. Therefore, the steps mentioned above will guide you on the bank reconciliation process.