The purpose of a bank reconciliation is to determine the reasons for the difference between the balance according to the company’s records and the balance according to the bank statement and to correct those items representing errors in recording that may have been made by the bank or by the company.
What is the meaning of reconciliation?
: the act of causing two people or groups to become friendly again after an argument or disagreement. : the process of finding a way to make two different ideas, facts, etc., exist or be true at the same time. See the full definition for reconciliation in the English Language Learners Dictionary.
How do you reconcile meaning?
1a : to restore to friendship or harmony reconciled the factions. b : settle, resolve reconcile differences. 2 : to make consistent or congruous reconcile an ideal with reality. 3 : to cause to submit to or accept something unpleasant was reconciled to hardship.
What makes a good account reconciliation?
Remember, the reconciliation should paint a picture of what is in an account at that moment in time. Accuracy. Make sure the person performing the reconciliation has a good understanding of what the account is used for and the proper information to support the balance of the account. Timeliness.
How do you cross a balance sheet?
Cross-check the balance sheet. Verify that the total for all assets shown in the balance sheet equals the total for all liability and stockholders’ equity accounts….The typical line items used in the balance sheet are:
- Accounts receivable.
- Fixed assets.
- Other assets.
- Accounts payable.
- Accrued liabilities.
How do you reconcile AP Aging?
The easy way to reconcile the aging to control account is by creating a transaction report for the accounts payable balances and group it by account balances. This will help to compare the total transaction report to the aging report for each customer or vendor.