Accounts Notes: BANK RECONCILIATION STATEMENT

Saturday 19 March 2011

BANK RECONCILIATION STATEMENT

Differance between Pass book and bank is called Bank reconcilation.

Points to remember for Bank reconcilation:

NEED FOR BANK RECONCILIATION:
1. Cheques issued but not yet presented for payment.
2. Cheques paid into the bank but not yet collected.
3. Direct debit made by the bank on behalf of the customer.
4. Amount directly deposited in the bank account.
5. Interest and dividends collected by the bank.
6. Direct payments made by the bank on behalf of customers.
7. Cheques deposited/ bills discounted dishonored.
8. Errors committed in recording transactions by the organization.
9. Errors committed in recording transaction by the bank.

PERFORMA OF BANK RECONCILIATION STATEMENT

To prepare a bank reconciliation statement, the bank balance as per the cash book and the bank statement as on a particular day are required along with details of both the books. If the two balances differ, the entries in both the books are compared and the items on accounts has which the difference has arisen are ascertained with the respective amount involved so that the bank reconciliation statement can be prepared.

The following Table explains this.
Particulars Amount Rs.
Balance as per cash book -----------
Add: Cheques issued but not presented -----------
Interest credited by the bank -----------
-----------
Less: Cheques deposited but not credited by bank -----------
Bank charges not recorded in the cash book -----------
Balance as per the pass book XXXXXX