Bank Reconciliation Process Explained by Jon Worrall, CPA

Bank reconciliations ensure accuracy by comparing an entity's ledger cash balance with the bank statement. This process includes identifying uncleared checks, deposits in transit, interest earned, and more. Utilize software or paper/excel methods for reconciling, focusing on accuracy to detect errors and fraud.

• Bank Reconciliation
• Finance
• Accounting
• Jon Worrall
• Software

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Uploaded on Sep 27, 2024 | 0 Views

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1. How to Figure Out Bank Reconciliations Jon Worrall, CPA

2. Bank Recons explained Process where an entity s General Ledger cash balance is reconciled to the bank statement Reconciling items can include: Uncleared Checks Deposits in Transit Interest Earned ACH/wire items, NSF Fees, Service Fees Serves as periodic check for Cash: Catch items not recorded in Ledger Detect fraud Identify bank errors 2

3. Paper/Excel vs. Software Software Enter bank statement balance Check off items that have cleared Record any transactions discovered on the bank statement that wasn t previously recorded Print for your records Paper/Excel Start with prior reconciliation including reconciling items Print off Cash Ledger for the current month Grab/Print Bank Statement Mark off items that have cleared the bank statement Compile new list of reconciling items Record any transactions discovered on the bank statement that wasn t previously recorded Buy new highlighter 3

4. Good vs. bad 4

5. Slide Title Utilize your software Can help prevent human error Not as much printing and highlighting If that s not an option Utilize excel Verify your formulas Perform timely Have someone else review Other accounting department staff Finance Committee/Board Look at old outstanding items on reconciliation Look for cutoff issues Save it so the pesky auditors can see them

6. Questions? jworrall@nd.gov 6