When you reconcile your bank account, you compare your internal financial records against the records provided to you by your bank. A monthly reconciliation helps you identify any unusual transactions that might be caused by fraud or accounting errors, and the practice can also help you spot inefficiencies. It is extremely common for there to be differences between the two balances, which you should track down and adjust in your own records. It is also useful to complete a bank reconciliation to see if any customer checks have bounced, or if any checks you issued were altered or even stolen and cashed without your knowledge

Some of the items involved in the reconciliation process are

The bank has charged fees for its services, such as a monthly account fee, Check printing charges

Deposits in transit are amounts that are received and recorded by the business but are not yet recorded by the bank

Errors in the cash account result in an incorrect amount being entered or an amount being omitted from the records.

When we find errors during reconciliation we must instantly correct or rectify them. If the error is in our books we must understand that if the error was a typo error or omission error or fraudulent mischief and appropriately investigate and take the appropriate steps. Set up better internal controls to ensure the risk is reduced. In case of an error from the bank, we must contact and communicate with the officials and inform them of such an error. In general, errors must be reported within 30 to 90 days from the bank statement date. When it comes to an electronic funds transfer, you have up to 60 days.

If we don't fix them they may continue to happen more in the future as well as our books will be showing incorrect amounts and balances

Other accounts that require reconciliation are; Credit Card Reconciliation, Customer Account Reconciliation, Vendor Account Reconciliation, Tax Reconciliation, and Inter-Company Reconciliation. What is your opinion?