Bank and Credit Card Reconciliation is performed on a monthly basis so that the business owner understands the differences between the balance shown in the bank statement and the balance shown in the business’s bookkeeping records.

Having the bank account reconciled monthly is of utmost importance. Both the bank and the business owner maintain independent records of the checks issued, deposits, and the balance in the bank account. The bank reconciliation helps validate that these independent records are matching.

In general, you will have differences between what your bank statement is showing vs. what your bookkeeping records are showing.