Even in our electronic, automation driven age banks can still make mistakes.
In our business, we’ve had instances of
missing credit card deposits, erroneous fees charged to our account and checks recorded at the wrong amount.
If one of your deposits was missing or your bank slipped up in some other way, how would you know it? Unless you or someone on your staff is preparing a bank reconciliation every month,
you probably wouldn’t have a clue.
A bank reconciliation is simply a process of verifying that your deposits, checks and other transactions were accurately recorded in your checking account by your bank.
Typically a bookkeeper or accountant goes through the bank statement each month and
physically verifies that each deposit, check & other transactions were accurately recorded by the bank. Any exceptions are immediately investigated and resolved.