It's all about Banks and Checks

Soo this is my third post, and it's all about bank reconciliation. What is bank reconciliation? Do you have a hint on what does it mean? Me, at first I don't even know what reconciliation is, as in a total "whaaaat?" So here it goes, Bank reconciliation is the process of bringing the bank's monthly report from each depositor showing deposits made, checks written, cancelled checks and service charges. It also tells us how to manage  checking accounts. Reconciliation statement putting an agreement the bank statement balance and the checkbook balance.

Gets? Okay here are more information about bank reconciliation.

The differences in the balance maybe due to:

1. Outstanding checks - checks issued by the depositors but have not yet been presented to the bank for payment.

2. Deposits in transit - deposits made but late to be included in the monthly bank statement. (because of the cut off period)

3. Service charges

4. Errors in check stub entries.

5. Cancelled checks - checks that have been paid by the bank.

Post-dated checks- are checks delivered now with a written date in the future, so that it cannot be cashed until that date. The danger to the recipient is that such a check is legally only a promissory note due at the later date, and if the account is closed or short when the check is presented at the bank, the payee has no rights to demand payment by the bank or claim that the delivery of a bad check was criminal.

This is an example of a bank reconciliation worksheet.  For example, this Bank Reconciliation Spreadsheet will help you keep your church and nonprofit accounting general ledger and bank statement reconciled.

and here is the bottom part of the worksheet.

Having a bank account especially when you're working is very important. Most of the people doesn't to put their money on banks, they just keep it in their homes. These people even cite that saving under a mattress is no different than having a bank account since interest rates are so terribly low.

Protection in banks are more secures because they have hundreds of guards. This protection is far better than hiding money at home and having it stolen, with no one to insure you'll get that money back. In fact, most money taken in home break-ins is never recovered. Let's put it this way, you hid your money somewhere in your room, but your maid cleaned every single space in your room and found your money, in her mind she would think and try to get those, or even get some of it and lie to you, but on the other hand, when you put your money in the bank, no one would get those but only you, you are the only one who can access to your account.

A checking account also is much more convenient for bill paying. Online banking makes this monthly nuisance even easier. Many merchants and online merchants require a bank account and a debit card if you have no credit card. Actually, with interest rates climbing on most credit cards, a simple debit card and checking account will cost you far less on each purchase plus over time.

Banking is easy and keeps your money in a better place :)

Checked by: Prof. Cris Paner