Bank Reconciliation

reconciliation

process of comparing two sets of records (e.g. a company’s accounting records and its bank statement) to ensure they match and account for any differences

cash balance per bank

ending cash balance reported by the bank on a company’s bank statement before adjustments for outstanding transactions

cash balance per books

ending cash balance recorded in the company’s accounting records before adjustments for outstanding transactions

deposits in transit

deposits that a company has recorded in its books but have not yet been processed and reflected in the bank statement

outstanding checks

checks that a company has issued and recorded in its books but have not yet been cleared or deducted from the bank account

bank service charge

fees charged by the bank for account maintenance, transactions, or other services, which may not yet be recorded in the company’s books.

interest paid by bank

interest earned on the company’s bank account that the bank adds to the account balance but may not yet be recorded in the company’s books

non-sufficient funds (NSF) check

A check received and deposited by a company but later rejected by the bank due to insufficient funds in the issuer's account.

collection of note

A situation where the bank collects money on behalf of the company (such as a customer payment on a promissory note) and deposits the amount into the company’s account.

note collection fee

A fee charged by the bank for handling the collection of a promissory note on behalf of the company.