Bank Reconciliation
Bank Reconciliation — Complete User Guide — Two Accounts Web
Comprehensive guide covering Bank Reconciliation setup, workflow, the reconciliation statement view, discrepancy resolution, and accounting regulation validation — with sample data and output.
Table of Contents
- Prerequisites — Enabling via Customize Menu
- System Overview
- Bank Reconciliation Model
- Navigation and Setup
- Creating a Reconciliation
- Reconciliation Statement View
- Cleared vs Pending Transactions
- Discrepancy Resolution
- Sample Data
- Edge Cases
- Accounting Regulation Validation
Prerequisites — Enabling via Customize Menu
Bank Reconciliations require the Bank and Cash Accounts tab to be enabled. This tab is enabled by default. If it is not visible:
- Go to Customize Menu (click the Customize button from navigation bar)
- Ensure Bank and Cash Accounts is toggled on
- Scroll to find Bank Reconciliations and enable it if not already visible
- Click Save
1. System Overview
The Bank Reconciliation module helps you confirm that all transactions recorded in the system for a bank account match the actual bank statement provided by your bank. The reconciliation process verifies that each transaction on your bank statement is accurately recorded in the software, ensuring that your financial records are both precise and complete.
1.1 Key Concepts
| Concept | Description |
|---|---|
| Bank Reconciliation | The process of comparing the system's cash balance for a bank account against the bank's statement balance as of a specific date. |
| Statement Balance | The closing balance reported by the bank on the statement. Entered manually by the user when creating a reconciliation. |
| Clear Date | The date a transaction was processed by the bank. Set on individual Receipts, Payments, Inter-Account Transfers, and Export LC Receipts. |
| Cleared Transactions | Transactions whose Clear Date is on or before the reconciliation date. These appear on the bank statement. |
| Pending Transactions | Transactions recorded in the system but not yet cleared by the bank (Clear Date is missing or after the reconciliation date). These do not yet appear on the bank statement. |
| Discrepancy | The difference between the bank statement balance and the system's cleared balance. A zero discrepancy means the account is reconciled. |
| Reconciled Status | When discrepancy = 0, the reconciliation is marked as Reconciled (green). Otherwise, it shows as Not Reconciled (red). |
1.2 Important Note
Bank Reconciliation is purely informational. It does NOT create any General Ledger entries. It only compares the balance you enter (from the bank statement) against the system's cleared transactions. The reconciliation itself does not adjust any accounts.
2. Bank Reconciliation Model
2.1 Fields
| Field | Required? | Description |
|---|---|---|
| Date | ✅ Yes | The date as of which the reconciliation is performed. All cleared transactions on or before this date are included. |
| Bank Account | ✅ Yes | The bank account being reconciled. Select from the list of active bank accounts. |
| Statement Balance | ✅ Yes | The closing balance shown on the bank statement for this account at the reconciliation date. |
2.2 List View Columns
| Column | Description |
|---|---|
| Date | The reconciliation date. Warns if the date is in the future. |
| Bank Account | The name of the bank account being reconciled. |
| Statement Balance | The closing balance entered from the bank statement (shown in the account's currency). |
| Discrepancy | The absolute difference between the statement balance and the sum of all cleared transactions up to the reconciliation date. Clickable drill-down to transaction details. |
| Status | Shows Reconciled (green) if discrepancy = 0, or Not Reconciled (red) if any discrepancy exists. |
2.3 Discrepancy Calculation
clearedBalance = Sum of AccountAmount for all cleared transactions
on this bank account where ClearDate <= Reconciliation Date
discrepancy = | StatementBalance − clearedBalance |
If discrepancy == 0 → Reconciled ✅
If discrepancy != 0 → Not Reconciled ❌
3. Navigation and Setup
3.1 Enabling the Tab
The Bank Reconciliations tab is enabled by default. To verify its visibility:
Settings → Tabs → Bank and Cash Accounts → Bank Reconciliations
(default: On)
The tab only appears when Bank and Cash Accounts is enabled.
3.2 Navigation
Bank Reconciliations → New Bank Reconciliation
Or navigate directly to an existing reconciliation from the bank accounts list by clicking the Last Bank Reconciliation date column.
3.3 Prerequisites
Before creating a bank reconciliation, ensure:
- The bank account exists and has transactions recorded (Receipts, Payments, Transfers, etc.)
- Each transaction that appears on the bank statement has a Clear Date set
- The bank statement is available showing the closing balance as of a specific date
4. Creating a Reconciliation
4.1 Step-by-Step
Step 1 — Open the form:
Bank Reconciliations → New Bank Reconciliation
Step 2 — Enter the reconciliation details:
Date: 31/03/2026 (the date on the bank statement)
Bank Account: Operating Account
Statement Balance: 785,200.00 (the closing balance on the bank statement)
Step 3 — Save: Click Save to create the reconciliation record.
Step 4 — View the reconciliation statement: The system displays the reconciliation view showing the bank statement balance, pending transactions, adjusted balance, balance sheet balance, and whether the account is reconciled.
4.2 OnSource Behaviour
When creating a new reconciliation from the bank accounts list or from the Bank Reconciliation Transactions drill-down, the form pre-fills:
- The Date parameter passed from the source view
- The Bank Account parameter passed from the source view
No other automatic pre-fill occurs — the Statement Balance must be entered manually.
5. Reconciliation Statement View
5.1 Statement Layout
The reconciliation view displays the following sections:
Bank Reconciliation — Operating Account
Date: 31/03/2026
Description Amount
─────────────────────────────────────────────────────
Closing Balance As Per Bank 785,200.00
Pending Deposit — 28/03 — RCP-003 +6,000.00
Pending Withdrawal — 30/03 — PMT-003 −2,500.00
────────────
Adjusted Closing Balance As Per Bank 788,700.00
Closing Balance As Per Balance Sheet 788,700.00
────────────
Discrepancy 0.00
Status: Reconciled ✅
5.2 How Each Line Is Calculated
| Row | Calculation | Source |
|---|---|---|
| Closing Balance As Per Bank | The Statement Balance entered on the Bank Reconciliation form | User input (from bank statement) |
| Pending Deposits | Each transaction where ClearDate is missing or later than the reconciliation date, AND AccountAmount > 0 | System GL transactions (Receipts, Transfers in) |
| Pending Withdrawals | Each transaction where ClearDate is missing or later than the reconciliation date, AND AccountAmount < 0 | System GL transactions (Payments, Transfers out) |
| Adjusted Closing Balance | Statement Balance + sum of all pending deposits + sum of all pending withdrawals | Computed |
| Closing Balance As Per Balance Sheet | Sum of AccountAmount for all CashAtBank transactions on this account up to the reconciliation date (including both cleared and pending) | System GL transactions (all) |
| Discrepancy | Adjusted Closing Balance − Balance Sheet Balance | Computed |
| Status | "Reconciled" if discrepancy = 0; "Not Reconciled" otherwise | Computed |
5.3 Pending Transaction Details
Each pending transaction row shows a label constructed from:
[Pending Deposit/Pending Withdrawal] — [Date] — [Reference] — [Contact] — [Description]
The reference is taken from the first available of: Receipt Reference, Payment Reference, or Inter-Account Transfer Reference.
6. Cleared vs Pending Transactions
6.1 What Determines Clear Date
Each transaction type has its own Clear Date mechanism:
| Transaction Type | Clear Date Field | Behaviour |
|---|---|---|
| Receipt | BankClearDate or Cleared = OnTheSameDate |
If Cleared = OnTheSameDate, ClearDate = Date. Otherwise, ClearDate = BankClearDate. |
| Payment | BankClearDate or Cleared = OnTheSameDate |
Same as Receipt. |
| Inter-Account Transfer | CreditClearDate / DebitClearDate |
Separate clear dates for the credit side (Paid From) and debit side (Received In). |
| Export LC Receipt | Cleared (bool) + ClearDate |
If Cleared = true, ClearDate = ClearDate field (falls back to Date). If Cleared = false, ClearDate = null (pending). |
| Opening Balance Entry | No clearing mechanism | ClearDate = the entry's Date (always considered cleared). |
6.2 How the System Determines Cleared vs Pending
ClearDate = computed from the transaction's clear date fields
If ClearDate is null:
→ Transaction is PENDING (not yet on bank statement)
If ClearDate exists and ClearDate > Reconciliation Date:
→ Transaction is PENDING (cleared after the statement date)
If ClearDate exists and ClearDate <= Reconciliation Date:
→ Transaction is CLEARED (appears on the bank statement)
6.3 Impact on Reconciliation
| Status | Included in Cleared Balance? | Shown as Pending in View? |
|---|---|---|
| Cleared (ClearDate <= Rec Date) | ✅ Yes | ❌ No |
| Pending (ClearDate > Rec Date) | ❌ No | ✅ Yes — adds to adjusted balance |
| Pending (ClearDate = null) | ❌ No | ✅ Yes — adds to adjusted balance |
7. Discrepancy Resolution
7.1 Common Causes of Discrepancy
| Cause | How to Fix |
|---|---|
| Statement Balance entered incorrectly | Edit the reconciliation record and correct the Statement Balance to match the bank statement. |
| A transaction is not yet recorded in the system | Create the missing Receipt or Payment for the bank transaction, ensuring the Date and amount match the bank statement. |
| A transaction has no Clear Date | Open the Receipt, Payment, or Transfer and set the Clear Date to the date it appeared on the bank statement. Mark as Cleared if appropriate. |
| A transaction has the wrong amount | Correct the amount on the Receipt or Payment, or create a correction Journal Entry. |
| A transaction is duplicated | Delete the duplicate Receipt or Payment. |
| Bank fees or interest not recorded | Create a Payment for bank fees or a Receipt for bank interest. Set the Clear Date to match the statement date. |
| Foreign exchange rate difference | If the bank account is in a foreign currency, verify the exchange rates match the bank's rates. Post an FX adjustment Journal Entry if needed. |
7.2 Drill-Down for Investigation
Click the Discrepancy amount or the Status in the list view to open the Bank Reconciliation Transactions drill-down. This shows:
7.2.1 Account and Balance Dates
The drill-down first displays the bank account name and the relevant balance dates:
- If this is the first reconciliation: Only a Closing Balance Date is shown — the date of the bank statement you are reconciling against.
- If a previous reconciliation exists: Both an Opening Balance Date (the day after the previous reconciliation's closing date) and a Closing Balance Date are shown. This defines the period being reconciled.
7.2.2 Closing Balances Summary
A table shows the opening and closing balances from the reconciliation records, along with the net movement between them. Each balance row includes an Edit button to quickly adjust the statement balance if it was entered incorrectly. The net movement row shows the difference between the two ending balances.
Example display when a previous reconciliation exists:
Closing Balances:
Date Closing Balance
[Edit] Opening 31 Dec 2025 500,000.00
[Edit] Closing 31 Jan 2026 600,000.00
Net movement 100,000.00
When no previous reconciliation exists, only the closing balance is shown.
7.2.3 Uncleared Transactions
When there are transactions recorded in the system that have not yet been marked as cleared on the bank statement, the system displays them in an uncleared transactions section. This section appears BEFORE the cleared transactions table, prompting you to review and update each one.
System message displayed at the top:
There are uncleared payments or deposits. Check uncleared payments or deposits whether they have cleared on bank statement on or before {Closing Balance Date}. Edit transaction to set status to Cleared and specify date when transaction has appeared on your bank statement.
Each uncleared transaction is shown in a table with the following columns:
| Column | Description |
|---|---|
| [Edit] button | Opens the transaction (Receipt, Payment, etc.) where you can set the Clear Date and mark it as Cleared. |
| Date | The date the transaction was recorded in the system. |
| Transaction | The transaction type and reference (e.g., "Receipt — RCP-003"). |
| Description | The description entered on the transaction. |
| Contact | The customer, supplier, or other party linked to the transaction. This column only appears if at least one uncleared transaction has a contact set. |
| Amount | The amount in the bank account's currency. Positive amounts (deposits) shown in black, negative amounts (withdrawals) shown in red. |
Example — Three uncleared transactions:
┌─────────────────────────────────────────────────────────────────────┐
│ There are uncleared payments or deposits. Check uncleared │
│ payments or deposits whether they have cleared on bank statement │
│ on or before 31/03/2026. Edit transaction to set status to │
│ Cleared and specify date when transaction has appeared on your │
│ bank statement. │
└─────────────────────────────────────────────────────────────────────┘
Date Transaction Description Contact Amount
──────────────────────────────────────────────────────────────────────────
[Edit] 28/03 Receipt — RCP-003 Customer payment Customer GHI +6,000.00
[Edit] 30/03 Payment — PMT-003 Utility bill Utility Co −2,500.00
[Edit] 31/03 Receipt — RCP-004 Late deposit Client D +1,200.00
To clear a transaction, click its Edit button. In the transaction form, set the Clear Date field to the date the transaction appeared on the bank statement. If the bank processes transactions on the same day they are recorded, you can also set Cleared = On The Same Date to automatically use the transaction date as the Clear Date.
7.2.4 Cleared Transactions
After the uncleared transactions section, the drill-down shows all transactions that do have a Clear Date on or before the reconciliation date. Each row includes an Edit button to view or modify the transaction.
System message displayed above the cleared transactions:
Verify each transaction on bank statement before {Closing Balance Date}. Adjust any missing transaction of bank statement, correct incorrect amounts and delete transactions which don't appear on your bank statement. Net amount as per your bank statement ending balances above you entered must equal to net amount as per your bank statement transactions below.
The cleared transactions table has the same columns as the uncleared table. At the bottom, the system displays:
Net movement +270,000.00
Net movement comparison: The system computes two net movement values — one from the closing balances (opening vs closing) and one from the cleared transactions. These should match. If they do not match, some transactions may be missing or have incorrect Clear Dates.
7.2.5 Middle Date — Enter Ending Balance
When there are transactions spanning a long period, the system calculates a Middle Date to help you narrow down discrepancies faster. This is the Clear Date of the transaction closest to the middle of the period.
If a Middle Date is available, a button appears:
[Enter ending balance as at {Middle Date}]
Clicking this button opens a New Bank Reconciliation form pre-filled with:
- Bank Account: The same account
- Date: The Middle Date value
You enter the bank statement balance as of that middle date. The system then compares the transactions up to that date, helping you identify whether the discrepancy exists in the first half or the second half of the period. This is called binary search reconciliation — each subsequent reconciliation narrows the problem period by half until the discrepancy is isolated.
7.2.6 Quick Actions
From the drill-down, you can also:
- New Receipt — Quickly add a missing deposit
- New Payment — Quickly add a missing withdrawal
Both buttons pre-fill the bank account and date from the reconciliation.
7.2.7 Middle Date Calculation Method
The system calculates the Middle Date to help you break a large reconciliation period into smaller segments:
- All cleared transactions in the period are sorted by Clear Date
- Transactions whose Clear Date equals the closing balance date are excluded (they represent the ending balance itself)
- If more than one transaction remains, the Middle Date is the Clear Date of the transaction at the midpoint of the sorted list
- If only one transaction exists but has a different date from the closing date, the Middle Date is that transaction's Clear Date
- If all transactions fall on the same date, no Middle Date is set (the period is already narrow enough)
7.3 Regular Reconciliation Cycle
1. Download bank statement from your bank (or receive it in paper form)
2. Note the closing balance as of the statement date
3. In the system, ensure all Receipts and Payments have the correct Clear Dates
matching the bank statement dates
4. Create a new Bank Reconciliation with the statement date and closing balance
5. Review the reconciliation view — if discrepancy = 0, the account is Reconciled
6. If discrepancy != 0, investigate using the drill-down and correct any errors
7. Create a new reconciliation each time a new bank statement is received
8. Sample Data
8.1 Scenario
| Bank Account | Operating Account |
|---|---|
| Opening Balance (as of 1 Jan 2026) | 500,000.00 |
| Bank Statement Date | 31 March 2026 |
| Bank Statement Closing Balance | 785,200.00 |
8.2 Transactions in the Period
| Date | Type | Amount | Clear Date | Status |
|---|---|---|---|---|
| 15 Jan | Receipt (Customer ABC) | +100,000.00 | 15 Jan | Cleared ✅ |
| 10 Feb | Payment (Supplier XYZ) | −75,000.00 | 12 Feb | Cleared ✅ |
| 1 Mar | Export LC Receipt | +250,000.00 | 1 Mar | Cleared ✅ |
| 15 Mar | JE (correction) | −5,000.00 | 15 Mar | Cleared ✅ |
| 28 Mar | Receipt (Customer GHI) | +6,000.00 | — | Pending ❌ |
| 30 Mar | Payment (Utility Bill) | −2,500.00 | — | Pending ❌ |
8.3 Balance Calculation
Opening Balance: 500,000.00
+ Receipt (AR — Customer ABC): +100,000.00
− Payment (AP — Supplier XYZ): −75,000.00
+ Export LC Receipt (ELC-2026-001): +250,000.00
− JE (correction): −5,000.00
+ Receipt (Customer GHI — PENDING): +6,000.00
− Payment (Utility Bill — PENDING): −2,500.00
──────────
Balance Sheet Balance (all transactions): 773,500.00
Cleared Balance (ClearDate <= 31 Mar):
500,000 + 100,000 − 75,000 + 250,000 − 5,000 = 770,000.00
8.4 Reconciliation Statement Output
Bank Reconciliation — Operating Account
Date: 31/03/2026
Description Amount
─────────────────────────────────────────────────────────
Closing Balance As Per Bank 785,200.00
Pending Deposit — 28/03 — RCP-003 +6,000.00
Pending Withdrawal — 30/03 — PMT-003 −2,500.00
────────────
Adjusted Closing Balance As Per Bank 788,700.00
Closing Balance As Per Balance Sheet 788,700.00
────────────
Discrepancy 0.00
Status: Reconciled ✅
8.5 Verification of Numbers
Statement Balance (from bank): 785,200.00
+ Pending Deposits (not yet on statement): +6,000.00
+ Pending Withdrawals (not yet on statement): −2,500.00
──────────
Adjusted Balance: 788,700.00
Balance Sheet Balance (all system transactions):
Opening: 500,000.00
Cleared receipts: +356,000.00 (100,000 + 250,000 + 6,000)
Cleared payments: −80,000.00 (75,000 + 5,000)
Pending receipts: +6,000.00
Pending payments: −2,500.00
──────────
788,700.00
Discrepancy: 788,700.00 − 788,700.00 = 0.00 ✅
8.6 List View Output
| Date | Bank Account | Statement Balance | Discrepancy | Status |
|---|---|---|---|---|
| 31/03/2026 | Operating Account | 785,200.00 | 0.00 | Reconciled ✅ |
| 31/01/2026 | Operating Account | 600,000.00 | 200.00 | Not Reconciled ❌ |
The second row (31 Jan) shows a Not Reconciled status because the statement balance of 600,000.00 does not match the cleared balance of 599,800.00 — there is a 200.00 discrepancy that needs investigation.
8.7 Middle Date Example — Binary Search Reconciliation
When the 31 Jan 2026 reconciliation shows a 200.00 discrepancy, clicking the discrepancy or status opens the drill-down. The system calculates a Middle Date to help narrow down the problem.
Scenario: The period from 1 Jan to 31 Jan has these cleared transactions:
| Date | Transaction | Amount | Clear Date |
|---|---|---|---|
| 1 Jan | Opening Balance Entry | +500,000.00 | 1 Jan |
| 5 Jan | Receipt (Client A) | +50,000.00 | 5 Jan |
| 10 Jan | Payment (Vendor B) | −30,000.00 | 10 Jan |
| 15 Jan | Receipt (Customer ABC) | +100,000.00 | 15 Jan |
| 20 Jan | Payment (Supplier XYZ) | −75,000.00 | 20 Jan |
| 25 Jan | Receipt (Client C) | +60,000.00 | 25 Jan |
Middle Date calculation:
Sorted Clear Dates: 1 Jan, 5 Jan, 10 Jan, 15 Jan, 20 Jan, 25 Jan
After excluding closing date (31 Jan): 6 transactions remain
Midpoint = 6 / 2 = 3 → 3rd transaction = 15 Jan
Middle Date = 15 Jan
Drill-down display:
Account: Operating Account
Closing Balance Date: 31 January 2026
Closing Balances:
Date Closing Balance
Opening (previous) 31 Dec 2025 500,000.00
Closing (current) 31 Jan 2026 600,000.00
Net movement 100,000.00
Adjusted Closing Balance As Per Bank: 600,000.00
Closing Balance As Per Balance Sheet: 599,800.00
Discrepancy: 200.00
Status: Not Reconciled ❌
Uncleared Transactions: (none — all have Clear Dates)
Cleared Transactions: (6 transactions listed)
[Enter ending balance as at 15 Jan 2026]
Clicking "Enter ending balance as at 15 Jan 2026" opens a new reconciliation form pre-filled with Date = 15 Jan 2026 and Bank Account = Operating Account. You enter the bank statement balance as of 15 Jan. If the discrepancy appears in the first half (1 Jan to 15 Jan), you continue narrowing within that period. If it appears in the second half (16 Jan to 31 Jan), you narrow there. Each step halves the search space until the discrepancy is isolated to a single transaction.
8.8 Opening Balance Date Example — Multi-Period Reconciliation
When a previous reconciliation exists, the drill-down shows both the Opening Balance Date and Closing Balance Date to define the period being reconciled.
Example — Second reconciliation on 31 Mar 2026:
Account: Operating Account
Opening Balance Date: 1 February 2026 (day after previous reconciliation)
Closing Balance Date: 31 March 2026
Closing Balances:
Date Closing Balance
Opening (previous) 31 Jan 2026 600,000.00
Closing (current) 31 Mar 2026 785,200.00
Net movement 185,200.00
This tells the user that the reconciliation covers transactions from 1 Feb to 31 Mar — a two-month period. The Middle Date button would help narrow down which specific week or day within those two months contains the discrepancy.
8.9 Uncleared Transactions Example — Drill-Down View
When a reconciliation has uncleared transactions, the drill-down shows them at the top with the system message. Below is an example of what the user sees when opening a reconciliation that has uncleared items.
Scenario: The 31 Mar 2026 reconciliation has a statement balance of 785,200.00, but three transactions have not yet been marked as cleared.
Account: Operating Account
Closing Balance Date: 31 March 2026
─────────────────────────────────────────────────────────────────────────
Closing Balances:
Date Closing Balance
[Edit] Closing 31 Mar 2026 785,200.00
Net movement 785,200.00
─────────────────────────────────────────────────────────────────────────
⚠ There are uncleared payments or deposits. Check uncleared payments or
deposits whether they have cleared on bank statement on or before
31/03/2026. Edit transaction to set status to Cleared and specify
date when transaction has appeared on your bank statement.
Transactions
Date Transaction Description Contact Amount
──────────────────────────────────────────────────────────────────────────
[Edit] 28/03 Receipt — RCP-003 Customer payment Cust GHI +6,000.00
[Edit] 30/03 Payment — PMT-003 Utility bill Utility Co −2,500.00
[Edit] 31/03 Receipt — RCP-004 Late deposit Client D +1,200.00
─────────────────────────────────────────────────────────────────────────
Verify each transaction on bank statement before 31/03/2026. Adjust
any missing transaction of bank statement, correct incorrect amounts
and delete transactions which don't appear on your bank statement.
Net amount as per your bank statement ending balances above you entered
must equal to net amount as per your bank statement transactions below.
Transactions
Date Transaction Description Contact Amount
──────────────────────────────────────────────────────────────────────────
[Edit] 01/01 Opening Balance Opening Entry — +500,000.00
[Edit] 15/01 Receipt — RCP-001 Customer ABC ABC +100,000.00
[Edit] 12/02 Payment — PMT-001 Supplier XYZ XYZ −75,000.00
[Edit] 01/03 Export LC Receipt ELC-2026-001 Global +250,000.00
[Edit] 15/03 JE — correction Adjustment — −5,000.00
Net movement +770,000.00
How to resolve the uncleared items:
- Click [Edit] on the 28/03 Receipt. In the Receipt form, set Clear Date = 28/03/2026 (the date it appeared on the bank statement). Save.
- Click [Edit] on the 30/03 Payment. Set Clear Date = 30/03/2026. Save.
- Click [Edit] on the 31/03 Receipt. Check if this transaction is on the bank statement. If it is, set the Clear Date. If it is not on the statement, leave it pending — it will appear on the next month's statement.
After updating all Clear Dates, re-open the reconciliation view. The uncleared section will be empty, and the cleared transactions table will include the newly cleared items.
Before vs After:
| Before Clearing | After Clearing |
|---|---|
| Uncleared: 3 transactions Cleared balance: 770,000.00 Discrepancy: 15,200.00 (785,200 − 770,000) |
Uncleared: 0 transactions Cleared balance: 779,700.00 Discrepancy: 5,500.00 (785,200 − 779,700) |
After clearing the three items, the discrepancy drops from 15,200.00 to 5,500.00 — the remaining discrepancy is the two pending items (6,000 + 2,500 − 1,200 = 7,300 difference adjusted) plus any rounding. The user continues investigating the remaining 5,500.00 discrepancy by checking for missing transactions or incorrect amounts.
9. Edge Cases
| Scenario | What Happens |
|---|---|
| No transactions on the bank account | Cleared balance = 0. Discrepancy = Statement Balance. Status = Not Reconciled (unless statement also shows 0). |
| All transactions are pending | Cleared balance = 0 (no ClearDate ≤ Rec Date). All transactions appear as pending items. Adjusted balance = Statement Balance + pending amounts. |
| Statement Balance entered as zero | Discrepancy = 0 − clearedBalance. If there are cleared transactions, the account will not reconcile. |
| Clear Date after reconciliation date | The transaction is treated as pending — it is not included in the cleared balance. It appears as a pending item on the statement. |
| Multiple reconciliations for the same account and date | Each reconciliation is independent. The list view shows all reconciliations. Use the most recent one for the current period. |
| Reconciliation deleted | The Bank Reconciliation record is removed. No GL entries are affected. The Last Bank Reconciliation column in the bank accounts list updates to the next most recent reconciliation date. |
| Transaction Clear Date changed after reconciliation | The existing reconciliation is not updated. The discrepancy on the existing reconciliation record remains unchanged. A new reconciliation will reflect the updated Clear Date. |
| Foreign currency bank account | The statement balance and all amounts are shown in the account's foreign currency. The discrepancy calculation works in the account's currency. |
| Bank account has credit limit / overdraft | The cleared balance may be negative (overdrawn). The reconciliation still works the same way — discrepancy = |statement − cleared|. |
| Multiple periods without reconciliation | Create separate reconciliations for each statement period. Each reconciliation independently verifies that period's statement balance against the cleared transactions up to that date. |
10. Accounting Regulation Validation
| Standard | Requirement | Compliance |
|---|---|---|
| IAS 7 — Statement of Cash Flows | Cash and cash equivalents must be reconciled to bank statements periodically | ✅ Bank Reconciliation module provides the mechanism to compare system cash balance to bank statement balance as of any date. |
| IAS 1 — Presentation of Financial Statements | Accuracy of financial statements depends on accurate cash recording | ✅ Regular reconciliation ensures the Balance Sheet cash figure matches verified bank data. |
| IFRS 9 — Financial Instruments | Cash is a financial asset; its carrying amount must be verifiable | ✅ Reconciliation provides the audit trail to verify the carrying amount of cash against independent bank records. |
| ISA 240 — Auditor's Responsibilities Relating to Fraud | Bank confirmation and reconciliation are key audit procedures | ✅ Each reconciliation records a specific date, bank account, and statement balance — creating an audit trail for external auditors. |
| ISA 315 — Identifying and Assessing Risks | Regular reconciliation is a key internal control over cash | ✅ The reconciliation list view shows all reconciliations with their status (Reconciled/Not Reconciled), enabling management review. |
| Internal Control — Segregation of duties | Cash reconciliation should be performed by someone not involved in cash handling | ✅ User permissions can restrict access to Bank Reconciliations to specific roles. |
| Tax Compliance — Accurate reporting | Tax returns must be based on accurate financial records | ✅ Regular bank reconciliations help ensure that receipts (revenue) and payments (expenses) are completely and accurately recorded. |
10.1 Pre-Save Checklist
[ ] Bank statement is available with the closing balance
[ ] The reconciliation date matches the bank statement date
[ ] All transactions that appear on the bank statement have Clear Dates set
[ ] All transactions that appear on the bank statement have correct amounts
[ ] Bank fees and interest on the statement are recorded in the system
[ ] The Statement Balance entered matches the bank statement exactly
[ ] Any pending items are genuinely not yet on the bank statement
[ ] Discrepancy is zero — or the cause of any discrepancy is known and documented
10.2 Complete User Workflow
From Bank Statement to Reconciled Status:
Step 1 — Download the bank statement:
Obtain the bank statement (PDF, electronic file, or online banking screenshot).
Note the statement date and closing balance.
Step 2 — Record any missing transactions:
If the bank statement shows transactions not yet in the system:
- Create new Receipts for deposits
- Create new Payments for withdrawals
- Set the Clear Date on each to match the bank statement date
Step 3 — Verify Clear Dates:
Check that each transaction has the correct Clear Date set.
Open Receipts or Payments and update Clear Date if needed.
Step 4 — Create the Bank Reconciliation:
Bank Reconciliations → New Bank Reconciliation
Date: 31 March 2026 (statement date)
Bank Account: Operating Account
Statement Balance: 785,200.00 (from bank statement)
Step 5 — Review the reconciliation view:
The system displays:
Closing Balance As Per Bank: 785,200.00
Pending items (if any): show with amounts
Adjusted Closing Balance: 788,700.00
Balance Sheet Balance: 788,700.00
Discrepancy: 0.00
Status: Reconciled ✅
Step 6 — Investigate if not reconciled:
If discrepancy != 0:
- Click the discrepancy amount to drill down to transaction details
- Check for missing Clear Dates, incorrect amounts, or missing transactions
- Correct the issues and re-check the reconciliation
Step 7 — Schedule the next reconciliation:
Create a new reconciliation when the next bank statement is received.
The Last Bank Reconciliation date in the bank accounts list helps
you track when each account was last reconciled.
End of Bank Reconciliation User Guide