Bank Reconciliation Statement

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What is a 'Bank Reconciliation Statement'

A bank reconciliation statement is a form that allows individuals to compare their personal bank account records to the bank's records of the individual's account balance in order to uncover any possible discrepancies.

BREAKING DOWN 'Bank Reconciliation Statement'

Since there are timing differences between when data is entered in the banks systems and when data is entered in the individual's system, there is sometimes a normal discrepancy between account balances. The goal of reconciliation is to determine if the discrepancy is due to error rather than timing.

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RELATED FAQS
  1. How often should a small business owner go through a bank reconciliation process?

    Learn about the bank reconciliation process, its purpose and how often it is recommended that small businesses perform a ... Read Answer >>
  2. How do I reconcile an account?

    Learn about the process of account reconciliation, including some of the ways that documented proof of financial activity ... Read Answer >>
  3. Why is reconciliation important in accounting?

    Learn about accounting reconciliation and its importance for individuals and businesses to help prevent fraudulent activity ... Read Answer >>
  4. Where did the concept of reconciliation in accounting come from?

    Learn about the history of account reconciliation, double-entry bookkeeping and the rise of modern accounting practices in ... Read Answer >>
  5. How is reconciliation treated under generally accepted accounting principles (GAAP)?

    Read about some of the different treatments of reconciliation under GAAP, particularly with respect to IFRS accounting or ... Read Answer >>
  6. How does bank reconciliation affect a cash control policy?

    Understand how the bank reconciliation process augments a company's cash controls and is an essential part of proper cash ... Read Answer >>
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