RIZZA A.

SORIANO
SHS-ABM APPLICANT
 RECALL
“Bank Statement Completion”
OFor this activity you will fill in
the balance of Ms. Rizza
Soriano in her bank
statement
 Rizza Soriano Current Account No.0719199526
Dumpay Basista, Pangasinan Statement Period: 01/01/2023-
01/30/23

Date Check Trans. Debit Credit Balance

No. Code
01/01/23   Balance     55,700.00
Forwarded
01/07/23 98765   8,000.00    
01/08/23 98766   3,000.00    
01/10/23   Deposits   15,000.00  

01/12/23 98767   5,000.00    

01/25/23   Bank 500.00    
Service
Charge
 MOTIVATION
“I WILL”
OAssuming you has your
own bank account. “What
will you do upon
receiving your bank
statement?”
 Presentation of the Lesson
O Is it possible that the balance of reflected in
the bank statement will not be the same with
the balance recorded in book account or the
accounting record?
O If so, what should the company do to know
the true balance of their cash?
O Why does company should perform bank
reconciliation?
O How does company will do this?
 Objectives:
At the end of the lesson the students will be able
to:
O Describe the Nature of Bank Reconciliation
Statement(ABM_FABM12-IId-10)
O Analyze importance of Bank Reconciliation
Statement
O Familiarize the common reconciling items in
preparing bank reconciliation statement
 Nature of Bank
Reconciliation Statement
Bank Reconciliation Statement
O is a report which compares the bank balance as per
company's accounting records with the balance
stated in the bank statement.
O It is normal for a company's bank balance as per
accounting records to differ from the balance as per
bank statement.
O The difference between these figures is the reasons
why companies prepare a bank reconciliation
statement
 The two common causes of the
discrepancy in figures are:
O Time lags - that prevent one of the parties
(company or the bank) from recording the
transaction in the same period as the other party.
O Example: A bank statement that ends January 30,
2015 and then the company were able to collect
cash of P20,000 at 5:00 PM. Bank usually closes
at 3:00 PM because of this, the cash collected will
not be reflected in the bank as deposit but it is
however recorded in accounting records of the
company.
 The two common causes of the
discrepancy in figures are:
O Errors - by either party in recording transactions
O Example: A check was issued to Meralco by the
company amounting to P1000. The company
recorded this as P100. When the check was
presented, the bank paid Meralco P1,000. In the
records of the company it was P100 while in the
records of the bank it’s P1,000. There is in this
case an error that will cause the difference
between the company’s records and the bank
records.
 The importance of Bank
Reconciliations are as follows:
O Preparation of bank reconciliation helps in the identification of
errors in the accounting records of the company or the bank.
O Bank reconciliations provide the necessary control mechanism
to help protect the valuable resource through uncovering
irregularities such as unauthorized bank withdrawals.
O If the bank balance appearing in the accounting records can be
confirmed to be correct by comparing it with the bank statement
balance, it provides added comfort that the bank transactions
have been recorded correctly in the company records
O Monthly preparation of bank reconciliation assists in the regular
monitoring of cash flows of a business.
Common Reconciling
Items
 Common Reconciling
Items
The following are the common
reconciling items:
O1. Interest earned. This among is
recorded in the bank statement and
must be added to the company’s
book balance.
 Common Reconciling
Items
O2. Service charges. These amounts
are charged by the bank for its
services in maintaining the checking
account and must be subtracted
from the company’s book balance.
 Common Reconciling
Items
O 3. Adjustments to deposits. The company may
sometimes record a deposit incorrectly, or it
may deposit a check for which there are not
sufficient funds (NSF). If so, and the bank
spots the error, the company must adjust its
books balance to correct the error. The bank
may also charge an NSF fee, which must be
recorded in the company’s books.
 Common Reconciling
Items

O 4. Adjustments to checks. The company may

occasionally record a check incorrectly. If so,
and the bank spots the error, the company must
adjust its book balance to correct the error.
 Common Reconciling
Items
OTo Note: The bank usually
issue a credit memo to inform
the client of any additions
made to the account of the
client. A debit memo is issued
by the bank to inform the client
that the account was deducted.
 Generalization
“Complete Me”
In this activity you will supply the correct word for each blank to
summarize the lesson for today.
1._______________statement is a report which compares the
bank balance as per company accounting records with the
balance stated in the bank statement. The two common
discrepancies in figures in bank balance and book balance are
2.______________ and 3._____________. There are common
reconciling items in preparing a bank reconciliation statement
namely: 4._____________, 5._____________,
6.______________. 7.______________, and it is important to do
bank reconciliation for the company
to :8._________________ ,9.__________________, 10.
______________.
 Application
O “Book or Bank Reconciling”
Direction: Identify whether the following
independent transaction is a book or a bank
reconciling.
 1. Eagle Repairs received P1,500 from Jane. The
bookkeeper Jane recorded the amount as P500.
2. Nation Bank collected from the customer of Eagle
the sum of P5,000 representing payment of the said
customer to Eagle. No entry was made in the books of
Eagle.
3. The bank teller deducted CHK 123 for P3,500 from
the account of Eagle. The said check was issued by
Eagles Company a different depositor of the bank.
4.The bookkeeper of Eagle recorded Check No. 345 in
the Cash Disbursement Journal as P5,205. The correct
amount of the check was P5,250.
5.The deposits of Eagle earned interest of P100 for the
month. Eagle does not have knowledge of interest
earned until it receives the bank statement.
 Evaluation

Matching type. Match your

answers in column A to the
choices in column B. Write the
letter of the correct answer in
your notebook or in a clean sheet
of paper.
 Enrichment Activity
Direction: True or False. Write TRUE if the statement is
correct, otherwise FALSE. Write your answer in your notebook
or in a clean sheet of paper.
1. Interest earned is added to the checking account balance and
in the bank statement.
2. Bank reconciliation is done in a monthly basis.
3. Bank reconciliation is not required in every company.
4. Reconciliation is important to check for errors and not
correct them.
5. Bank reconciliation statement does not follow any format.
 Assignment
O Direction: Give the common reconciling items and describe each. Write
your answer in your notebook or in a clean sheet of paper.
_______________________________________________________________
_______________________________________________________________
_______________________________________________________________
_______________________________________________________________
________________________________________________
O Criteria for Scoring:
O Content - 5 points
O Organization - 5 points
O Clarity of idea - 5 points
O Total - 15 points
 Assignment
Note: Make an advance
reading on the next topic
“Analyzing the effect of
Reconciling items in
preparing bank reconciliation
statement
 
 THANK YOU
FOR
LISTENING!
GODBLESS US
ALL