BANK RECONCILIATION

STATEMENT

Presented by K .Jaswanth
Regd.no 18331E0049
 INTRODUCTION

• Definition:
A bank reconciliation is a schedule explaining any differences between the balance
shown in bank statement and the balance shown in Cash book.
Cash book:
A book in which record all the transaction relating to cash receipt and payments in
detail is called cash book. Prepared or maintain by company.
Bank Statement:
Report released by banks that lists deposits, withdrawals, checks paid, interest
earned, and service charges etc.
 OBJECTIVES OF BRS

• It reflects actual bank balance position

• Detect mistake in cash book or Pass book
• Prevent frauds in recording banking transactions.
• Explain any delay collection of checks.
• It identifies valid transaction recorded by one party but not by other
 NATURE OF THE CASH BOOK AND THE BANK
STATEMENT.
• The balance in the cash book is an asset to the company, therefor
Cash Book
A debit represents an (increase) A credit represents a
(decrease)

• The balance as per the bank statement is a liability to the bank, therefore:
Bank statement
Dr. Cr. Balance
(represents (represents (Represents the
decreases) increases) amount owed to
the clients)
 REASONS FOR DIFFERENCES BETWEEN THE
CASH BOOK AND THE
BANK STATEMENT
• The bank balances as shown in the cash book and the bank statement seldom
agree. There are various reasons for this. A statement is used to reconcile the
two balances.
• There are some transactions recorded by the depositor but missed by the bank.
• Similarly, there are transactions appearing on the bank statement and not
recorded by the company
• Interest allowed by the bank