Why reconcile your bank accounts?

Categorizing your transactions is only the first step. Reconciliation your accounts ensures that all of your transactions are captured.

First, what is bank account reconciliation? 

To reconcile a bank account, we compare the bank statement to the bank register in your books and ensure that they are aligned.

We compare the opening and closing balances, as well as each transaction. If there are any differences, we identify the issue and resolve it. 

Why reconcile your accounts?

The bank statement is the source document, and your books need to match. 

Issues can arise due to technology, like transactions missing from the bank feeds, or from data entry mistakes. No matter how diligent we are in the moment, technology can fail us, and human error is always a possibility. 

Why is accuracy so important?

Transactions may be missing from your bank register, which could mean that you are missing important tax deductions or underreporting your income.

Transactions may duplicated, which could result in overreporting your income and paying too much in taxes. 

In either case, without the correct data, it is impossible to know how your business is really doing. Reconciling the accounts allows us to catch these mistakes and correct them—which allow you to make informed decisions.

At Ember Bookkeeping Services, reconciliation is the first step in our multi-layer review process each month. We reconcile bank and credit card accounts, as well as merchant processors like Stripe, mortgage and loan accounts, clearing accounts like Undeposited Funds, and any others that are relevant to your books.

Each business is unique, and it’s our business to make sure your books are both accurate and insightful.

🌱 This post was entirely written by me, Rosa, drawing on the knowledge gained during my careers in bookkeeping, dance and design, and my enjoyment in writing—entirely free of generative AI.