Bank Reconciliation[MIGRATED]

Migrated to http://wavelet.asia/customer-portal/2011/02/28/bank-reconciliation/

Bank reconciliation is the process of matching and comparing figures from accounting records against those presented on a bank statement. Less any items which have no relation to the bank statement, the balance of the accounting ledger should reconcile (match) to the balance of the bank statement. Bank reconciliation allows companies or individuals to compare their account records to the bank's records of their account balance in order to uncover any possible discrepancies (Wikipedia, 2009).

  • Finance > Cashbook > Bank Reconciliation
Create Statement:
  • Select a PC Center, then click 'Set PC Center'.
  • Select a Cashbook, then click 'Set Cashbook'.
Create New Statement:
  • Enter a name for the statement.
  • If it is a monthly statement, key in the opening date (eg. 1.12.2008). Next, in the 'Balance Open' enter the amount (eg. RM 1000) as per the opening balance (1.12.2008) from your actual bank statement.
  • Do the same for the closing date and closing balance.
  • These steps are taken to enter the amounts from the bank statement to make comparisons with the amounts in the cashbook in EMP.
  • Click ' Create New Statement'.

  • The Bank Statement List will appear as below:

  • Click 'Edit' to edit the cash statement as below:

Add Details
  • Click 'Add Details' to file transactions for the reconciliation.
  • Select the number of transactions to be displayed.
  • Click on the Description in blue to view the receipts or payment voucher.
  • When filing the transactions, the user is required to refer to the actual bank statement. Check if the transactions on the list have already been paid (PV) or received (Rct). If the transaction on the list matches the bank statement, tick the box on the right to select a particular transaction. Then click 'File It'.

  • To view the bank reconciliation report, click 'BankRecon2'.
  • The following will appear:

Explanation of the report above:

- The purpose is to reconcile the cashbook (31.12.2008) of RM 15,819 to bank statement's closing balance of RM 1,800.
- The difference is due to unpresented cheques, uncredited cheques and any discrepencies.
- From the report, total unpresented cheques is RM 500. An unpresented cheque is when the user company issued a cheque payment of RM 500 and the cashbook has already been  
  deducted with RM 500 but the the bank has not. This is caused by the processing time of when the bank has to clear the cheque.
- This causes the bank to have have a balance of RM 500 more than the cashbook.
- Uncredited cheques (eg. RM 13,989) are cheques that have been issued to the bank by the customer and again, the bank has not cleared the cheque but the user's cashbook has 
  already been debited.
- This situation resulted in the bank balance being less than the cashbook balance.

Bank Statement as at 31 December 2008.

Closing balance as per cashbook 15,319
Add: Unpresented cheques 500
Less: Uncredited cheques (13,989)
Closing balance as per bank statement 1,830
Actual closing balance as per bank statement   1,800  
Discrepancies      30    

Please refer Discrepancies for ways of dealing with it.

To create a new statement for January 2009, repeat the steps above.