What Is Reconciliation?

Reconciliation is a fundamental accounting process that ensures the actual money spent and earned matches the money leaving or entering your account at the end of a fiscal period. Reconciling all the accounts is an important part of running a business. It is a good opportunity to to check for fraudulent activity and to prevent statement errors and to catch them early.

It is a good practice to reconcile the accounts at the end of every fiscal month. Business owners will verify that every transaction sums to the correct ending account balances. Usually there are two way to reconcile an account: reviewing documents and reviewing analytics of all statements.

Ways Monthly Accounting Reconciliation Will Benefit Your Business

• Eliminates errors. Accounting reconciliation on a monthly basis is a great way to keep your bookkeeping identical to what is recorded at your bank account. It could eliminate accounting errors and keep them from happening again and save you lots of time and money.
• It keeps your business deposits accurate and correct. Human errors can lead to deposit errors, which could have a big impact on your business and reputation.
• It will keep surprises from hitting your bank account. With reconciliation of your accounts each month will keep track of all transactions, even the ones that maybe delayed.
• It will save you money. Reconciling your accounts is great for your business and profitability because it can help you identify bank fees and other hidden expenses you might not know about.

If you need help with items referenced in this post, feel free to reach out to us at info@accountingbiz.co or schedule a free consultation with us here.