5 Easy Steps to Learn Bank Reconciliation

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Many people are dread with the thought of learning bank reconciliation, but in reality, it is not really very difficult to perform. All you require is the fundamental skill to add and subtract. With a little of practice, you can turn out to be skilled at bank reconciliation and be capable to ensure that your bank account is showing the amount that it supposed to be showing. Here are the 5 easy steps to learn bank reconciliation.
Step 1

Be familiar with bank reconciliation. You record the figure of money that is going out and coming into your account, when you write and deposit checks (if you’re American) and cheques (if you’re British). Your bank also does the same. The procedure of bank reconciliation is to make sure that you and the bank are showing the same figures in your bank account.
Step 2

Understand the need of bank reconciliation. More than often people overlook to record a check that they wrote or a deposit. These can consequence in bounced checks, which is equally costly and criminally responsible in most awful case situations. By learning bank reconciliation, you can ensure that you confirm that your records match the bank’s records on a month to month basis.
Step 3
Analyze your checkbook. Begin analyzing balance shown in your checkbook. Now, subtract any bank service charges or deductions that are displayed on your bank statement but not recorded in your checkbook. Then, add all credits i.e. bank interest that are shown in your bank statement but not recorded in your checkbook. Finally, note down the final amount for your checkbook.
Step 4

Have a glance at your bank statement. Make check with the bank statement’s ending balance. Reverse the exercise that you have done on step 3. Add any deposits that are recorded in your checkbook but not displayed on your bank statement. Now, subtract any checks, ATM withdrawals or other withdrawals that are not displayed on your bank statement. Then, note down the final figure for your bank statement.
Step 5

Verify if the two figures match. If they do match, then you have successfully reconciled your bank statement, and you have learned bank reconciliation. If they do not match, find out why they don’t? You must have to do some investigation, if you have two different figures after the reconciliation procedures. Start again with the steps 1 to 5 and see whether the problem was just a match error. Get in touch with you bank for further help, if you cannot find out why you are unable to reconcile your checkbook with your bank statement.

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