Why You Need a Bank Reconciliation and How to Do It ?

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Why You Need a Bank Reconciliation and How to Do
It ?
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Why You Need a Bank Reconciliation and How to Do
It ?
1. If youre self-employed, the chances are
youll need to reconcile your bank account on a
regular basis.
2. The process of bank reconciliation can seem
daunting to some, but its actually very simple
to do if you follow the right steps each time.
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3. Heres how to perform and document an
effective bank reconciliation so that your
business accounts balance at all times and you
know exactly how much money is in your account at
any given time.
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The importance of keeping financial records
1. Keeping good financial records is an important
part of managing your financeswhether youre
running a small business or simply keeping track
of your personal income and expenses.
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2. No matter how big or small, every organization
needs to keep track of where its money comes
from, how its spent, and whether it overspent.
3. A bank reconciliation ensures that all
transactions are accounted for in one place so
that you can be sure nothing has been overlooked.
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The Purpose of a Bank Reconciliation
1. A bank reconciliation is an accounting review
that compares your bookkeeping records with those
of your bank.
2. Once youve entered all of your transactions
into Quicken, for example, you can create a trial
balance report that lists each account's debits
and credits (adjustments are included as well).
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3. With all of your transaction information at
hand, its time to sit down with your statements
from the bank itself.
4. Reviewing both sets of records together gives
you an opportunity to spot any discrepancies or
inaccuracies that might have otherwise gone
unnoticed.
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When should you start your first bank
reconciliation process?
1. If youre just getting started in your
business it can be tempting to just check your
online banking once or twice a month, maybe even
less.
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2. After all, whats another few bucks here or
there? But its important to get into good
bookkeeping habits from day one of your business,
especially if you have serious ambitions for that
small business of yours.
3. In fact, doing an online bank reconciliation
as soon as you receive your statement is probably
one of the best ways for new business owners to
familiarize themselves with bookkeeping.
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4. The bank reconciliation process is an
important part of small business bookkeeping.
5. Whether youre keeping books manually or using
computerized software, reconciling your bank
statements on a regular basis is critical.
6. If you notice any discrepancies, its easy to
take actionbefore your bank starts hounding you
for unpaid fees.
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Website https//reliablebookkeepingservices.com.a
u
Email enquiry_at_reliablebookkeepingservices.com.au