Bank reconciliation is an important monthly part of any accounts department. It compares your overall ledger against your bank statement to test for virtually any irregularities or overcharges and provides businesses a superb financial oversight from month to month.
An important function on the bank reconciliation statement is always to hunt for any missing money, therefore it is essential that the duties of issuing payments and reconciliation are separated. Reconciliation statements must be audited in-house at least once 30 days through another auditor at least 12 months.
If you are searching to audit in-house, then this is the simple 7-step help guide to auditing your bank reconciliation statement:
1) Gather your bank statement, general ledger and bank reconciliation documents with the month you intend to audit.
2) Look into the final figures in your reconciliation document against your bank statement for your account. The amounts should match.
An important function on the bank reconciliation statement is always to hunt for any missing money, therefore it is essential that the duties of issuing payments and reconciliation are separated. Reconciliation statements must be audited in-house at least once 30 days through another auditor at least 12 months.
If you are searching to audit in-house, then this is the simple 7-step help guide to auditing your bank reconciliation statement:
1) Gather your bank statement, general ledger and bank reconciliation documents with the month you intend to audit.
2) Look into the final figures in your reconciliation document against your bank statement for your account. The amounts should match.
3) Look into the final figures on your own bank reconciliation document against your general ledger totals to make sure they both match.
4) Find the difference in value relating to the bank statement ending balance plus your general ledger total. The visible difference needs to be properly reflected inside your bank statement.
5) Match off transactions from the bank statement and general ledger account. Each transaction in a document really should have a corresponding transaction inside the other. It's usually far better mark these off since you head over to avoid confusion.
6) Highlight any non-matching transactions involving the general ledger and bank statement. Them are 'reconciling' items and may be landed within your bank reconciliation document with full reasons for the discrepancy. These products are generally the consequence of funds that contain not yet cleared or cheques which have been waiting being cleared.
7) Double-make sure the real difference involving the bank statement and general ledger is properly landed inside your bank reconciliation document.
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