Why Monthly Bank Statement Reconciliation is Essential

Monthly Bank Reconciliation

Regular reconciliation of bank statements and other financial accounts should be a regular practice in your business. Do you keep up with regular checks to ensure the quality of your financial tracking system? If you don’t have the time or desire to handle these tasks, then you should consider the advantages of hiring an experienced bookkeeper to help.

Here are a few reasons why it is important to keep up with bank statement reconciliation:

Identify Problems and Errors

Typos, missed payments, and other manual errors can cause problems in the financial tracking system. You need to make sure that the input is accurate so that you can have access to updated financial reports. Even small errors can have a big impact on the long-term success of your company.

Bank statement reconciliation helps to catch the errors. When the errors are identified early, it is easier to make changes and adjustments to improve the quality of financial reports.

Missing Transactions

Sometimes, there are transactions that might be missing in your bookkeeping software. For example, if a check was issued but the receiver waited for several months to cash it, then you might be hit with a surprise in your checking account when the check finally goes through. Tracking every transaction will give you the chance to follow-up if needed. Also, you can be sure that you aren’t missing any transactions on the reports.

Identify Employee Behavior

Most business owners want to trust that their employees are honest with the company accounts. But, there are times when employees make poor choices and embezzle money. These errors are easily overlooked if you aren’t monitoring the cash flow within the company. Regular bank statement reconciliations will help you to minimize and prevent losses from employee dishonesty.

Monitor the Growth of the Company

If the financial system isn’t updated and reconciled, then it means that you are unable to see an accurate overview of the company by looking at financial reports. Missing transactions, incorrect data entry, and other problems can change the numbers and alter the output of the reports. To make the best financial decisions for your company, you need to be sure that you have up-to-date information about the financial health of the business.

At Easier Bookkeeping, we know that business owners have a lot of responsibility to manage the company. If you don’t have the time to keep up with mundane tasks, like monthly bank statement reconciliation, then we invite you to talk with our experienced team right away. We offer small business bookkeeping services, and we are here to help: (888) 620-0770

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