News Rules For Recording Transactions Inwards Banking Concern Reconciliation Statement
Rules:
1. In the Books of Trader (Cash Book/Bank Column)
Increase inwards Bank Balance = Debit (Receipt Side)
Decrease inwards Bank Balance = Credit (Payment Side)
2. In the Books of Bank (Pass Book/Bank Statement)
Increase inwards Bank Balance = Credit
Decrease Bank Balance = Debit
Theoretically speaking at that topographic point should non hold upwardly whatsoever disagreement betwixt Cash Book (Bank Balance) as well as Pass Book Balance (Bank Statement), equally all banking transactions are recorded inwards both the books.
But by as well as large it is industrial plant life that banking concern residuum equally per Cash Book does non tally amongst banking concern residuum equally per Pass Book or Bank Statement. Hence, to reconcile the to a higher house balances as well as explicate the reasoning for the divergence betwixt them 'Bank Reconciliation Statement' is prepared.
Bank Pass Book (Bank Statement)
Bank Pass Book (also known equally Bank Statement) is a re-create of Customer's A/c maintained past times the Bank inwards his principal ledger. Since Bank is the trustee of the customers, the banking concern provides to its client a Bank Statement at regular intervals (generally during the 1st calendar week of each month), which summarises payments equally good equally deposits as well as other charges for the period.
Date of Preparation of Bank Reconciliation Statement
Normally Bank Reconciliation Statement is prepared past times the trader on closing appointment of accounts, i.e., Dec. 31 or June thirty or March 31. Sometimes it is prepared at the destination of every calendar month later preparing Cash Book or regularly later certainly interval to banking concern fit the accuracy of Cash Book. statutory at that topographic point is no specific appointment to develop it.