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Bank reconciliation

anita (Wedding Affair) (55 Points)

23 July 2018

Hi Everyone!

Can someone help me with Bank reconciliation procedure...

From start to posting Journal entrie at the end??

Thanks and regards

Anita

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2 Replies

Sarath Rajendran (Nil) (2791 Points)
Replied 23 July 2018

The process for preparing the bank reconciliation statement (BRS) follows the below steps or method:

(1) Compare the both opening balances of cash book and bank statement, these might be different because of un-presented or un-credited cheques from the previous period. Locate them on the bank statement and tick (✓) off these and opening balances as now agreeing.

(2) Compare the debit side of the cash book with the credit side of the bank statement and the credit side of the cash book with the debit side of the bank statement . Place a (✓) against the items which appear in both records.

(3) Identify the un-ticked items on the debit side of the bank statement and enter them on the credit side of the bank column of the cash book. They can then be ticked off too.

(4) Identify the un-ticked items on the credit of the bank statement and enter them on the debit side of the bank column of the cash book. They can then be ticked off too.

(5) Correct any errors or mistakes in the cash book.

(6) Calculate revised and corrected balance of the bank column of the cash book. This updated balance is shown in the balance sheet as cash at bank.

(7) Start the bank reconciliation statement with the up-dated cash book balance (as in “✓” above).

(8) If bank reconciliation statement is started with a debit balance then add any un-presented cheques and deduct any un-credited cheques. The opposite rules apply if it is started with a credit balance.

(9) Make necessary adjustments for bank errors. If bank reconciliation statement is started with a debit balance then add back any amounts credited in error by the bank and deduct any amounts debited in error by the bank. The opposite rules are followed if statement is started with a credit balance.

(10) The resulting figure should be equal the balance shown as per bank statement.

Refer this link https://www.financialaccountancy.org/bank-reconciliation-statements/steps-and-rules-for-preparing-a-bank-reconciliation-statement/

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RAMESH PATEL (STUDENT) (93 Points)
Replied 24 July 2018

brs is prepared to know the reasons why bank balance as per cash book and pass book are not matched.
it is very easy to prepare brs. u have two balances one of cash book and one of pass book. now what u have to do is u can take any one balance and see the differences in other and wrote down it and by adding and subtracting the differences u will find the other balance. that's how u make brs in easy way.

now no journal entry is required to pass to tally the balances. brs is just an informative statement.