Bank reconciliation catches errors, fraud and timing differences. Items the bank knows about but you don’t (fees, interest, returned cheques) adjust the book side; items you know about but the bank hasn’t processed yet (deposits in transit, outstanding cheques) adjust the bank side.
How to use the Bank Reconciliation Calculator
- Balance as per cash book
- Automatic payments not recorded
- Bank charges
- NSF (bounced) cheques
- Interest earned
- Receivables collected by the bank
- Balance as per bank statement
- Deposits in transit
- Outstanding cheques
- Bank errors (+ add / − subtract)
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter the cash book balance and its adjustments, then the bank statement balance and its adjustments.
Inputs explained
| Field | What to enter |
|---|---|
| Balance as per cash book | Amount in your currency |
| Automatic payments not recorded | Amount in your currency |
| Bank charges | Amount in your currency |
| NSF (bounced) cheques | Amount in your currency |
| Interest earned | Amount in your currency |
| Receivables collected by the bank | Amount in your currency |
| Balance as per bank statement | Amount in your currency |
| Deposits in transit | Amount in your currency |
| Outstanding cheques | Amount in your currency |
| Bank errors (+ add / − subtract) | Amount in your currency |
What each result means
- Adjusted book balance = [Balance as per cash book] – [Automatic payments not recorded] – [Bank charges] – [NSF (bounced) cheques] + [Interest earned] + [Receivables collected by the bank]
- Adjusted bank balance = [Balance as per bank statement] + [Deposits in transit] – [Outstanding cheques] + [Bank errors (+ add ÷ − subtract)]
- Difference = [Adjusted book balance] – [Adjusted bank balance]
Example values
How the main result changes when Balance as per cash book changes and everything else stays at the example values above:
| Balance as per cash book | Difference |
|---|---|
| 6,250 | -6,250 |
| 9,375 | -3,125 |
| 12,500 | 0 |
| 15,625 | 3,125 |
| 18,750 | 6,250 |
| 25,000 | 12,500 |
Formula
Adjusted book balance = book balance − automatic payments − bank charges − NSF cheques + interest earned + collections by bank
Adjusted bank balance = bank balance + deposits in transit − outstanding cheques ± bank errors
The two adjusted balances should be equal
Worked example
Inputs: Balance as per cash book: $12,500; Automatic payments not recorded: $450; Bank charges: $35; NSF (bounced) cheques: $300; Interest earned: $22; Receivables collected by the bank: $800; Balance as per bank statement: $13,037; Deposits in transit: $1,500; Outstanding cheques: $2,000; Bank errors (+ add / − subtract): $0.
Results: Adjusted book balance = $12,537.00; Adjusted bank balance = $12,537.00; Difference = $0.00; Result = Reconciled – the balances agree.
Frequently asked questions
What is a bank reconciliation?
Matching your records with the bank statement to explain every difference.
What are deposits in transit?
Deposits you've recorded that the bank hasn't processed yet.
How often should I reconcile?
At least monthly, when the statement arrives.