Bank Reconciliation
Last reviewed 2026-05-11 by Asad Ali, Founder & CEO
Matching bank statements with internal records to identify discrepancies.
Bank reconciliation compares your internal accounting records against your bank statement to ensure they match. Differences arise from outstanding checks, deposits in transit, bank fees, interest earned, and errors. Reconciling monthly (or more often) catches unauthorized transactions, bank errors, and bookkeeping mistakes before they snowball.
Example
During monthly reconciliation, a business owner finds a $500 discrepancy caused by an outstanding check that hasn't cleared and a $12 bank fee not yet recorded in the books.
Why It Matters for Your Business
Regular bank reconciliation is the most basic financial control—skipping it allows errors, fraud, and unauthorized charges to go undetected.
Practical Tips
- •Reconcile every bank account at least monthly, ideally within the first week after statement close.
- •Investigate and resolve every discrepancy immediately rather than letting them accumulate.
Common Questions About Bank Reconciliation
What is an example of bank reconciliation?
During monthly reconciliation, a business owner finds a $500 discrepancy caused by an outstanding check that hasn't cleared and a $12 bank fee not yet recorded in the books.
Why does bank reconciliation matter for my business?
Regular bank reconciliation is the most basic financial control—skipping it allows errors, fraud, and unauthorized charges to go undetected.
How does FiscalInsights help with bank reconciliation?
FiscalInsights tracks bank reconciliation automatically as part of its AI bookkeeping workflow. Connect your bank accounts and the platform handles categorization, reconciliation, and reporting without manual entry.
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