Bank charges
Banks
usually charge interest and fees right at the
end of the month, just before they print and
mail you the statement. You may not know about
these charges until you get your statement. You
will need to record these bank charges in your
ledger before you start the reconciliation
process.
Automatic monthly payments
Your
company may have leases or bank loans for which
payments come out of the bank account
automatically. You could account for these
transactions during the month, or they may be
left until the end of the month when the bank
statement arrives. These transactions will need
to be recorded in the journals before the
reconciliation process can begin.
Bank errors
Yes,
I know it's hard to believe, but your bank can make
mistakes. Tellers can incorrectly record the amount
of a check you wrote or a deposit you made or they can accidentally post someone else's
transaction to your account. With the increase in
bank computerization in recent years, the
opportunities for human error are reduced, but such
errors can still occur. Bank error is one of the
important reasons for reconciling your account. Most
banks will allow you to point out their error only
for a certain amount of time, and after that time
has elapsed, there may be nothing you can do about
it. You must bring any bank error to the bank's
attention immediately. It will be accounted for in
the reconciliation process with the expectation that
the bank will reflect the correction the following
month.
Automatic monthly payments,
Bank charges and Errors