If biting an elaichi while eating biryani is frustrating, so is finding a mismatch in your book of accounts even after recording all the transactions!
Mismatches don't pop out suddenly. They just hide behind granules of transactions all the time. Accountants reconcile bank statements with the accounting records and catch these culprits wearing the masks of bank charges, uncleared and cleared cheques and so on.
Bank reconciliation statement is a final financial report prepared to match the companies' financial records with bank transaction statement. Companies prepare BRS daily, weekly or fortnightly to keep their books accurate. Then, there are a few who don’t and suffer. If you are one, better reconcile from day 1 with the right solution.
Prepare BRS in a click
Every accountant has just one wish: Not even a penny should go out of my sight. The price paid to achieve it is incomparable at times. Matching 100s of e-statement entries with book of accounts test the patience of matchmakers, here, accountants. Simply put, it demands huge manual effort as they are error prone.
Tech providers understood the stress and automated e-statement reconciliation with accounting software. From then on, tech equipped accountants started doing wonders.
Waving goodbye to errors, screen switching (between BRS sheet and e-statement) and rechecking
Identifying the missing entries in the book of accounts in a click
Saving up to 90% effort spent on reconciliation
By the way, those are the top three reconciliation benefits enjoyed by the customers of Gofrugal
Cheques issued would have not been cleared by the bank. If the status had not been updated in the books, then mismatches emerge. At times, the receiver would have forgotten to deposit the cheque too.
Until you check bank e-statements, you will not have any clue about such happenings. Banks don't notify these via SMS either.
Cheques received from a party or contra cheque transactions would have not got cleared by the bank. Forgetting to update will cause chaos in your books.
To err is human. If the cheque cleared data in your books is different from the actual cleared date, especially in case of post-dated cheques, then it's same as losing your mobile phone in a crowded place. You have to depend on divine luck to locate it.
Even after recording all the payables and receivables, the above will not let your actual bank balance in the e-statement match with the bank balance as per your books. Apart from catching these culprits, preparing a bank reconciliation statement will help in identifying stale cheques and tracking every penny that moves in the company.
The above terrorizes when they actually happen. As hackneyed as it sounds, prevention is always better than cure.
Enter, reconciliation!
The downloaded bank e-statement can be uploaded directly into the accounting software. Entries in the software will get matched with the e-statement entries and the cleared date will be updated automatically.
Know how
Gofrugal went a little further and partnered with ICICI bank to simplify banking operations. A customer of both these entities, can download the e-statement within the software and all it takes is just one click to reconcile and find out the mismatches. The effort in handling the mismatches has become negligible with this integration.
Know howNew entries will be made and wrong entries will be removed from the books to tally the balances. Once every entry in the bank e-statement is matched with the entries in the books, the Bank Reconciliation Statement can be prepared with unreconciled items.
Experience Auto BRS
Step 1: Fetch the balance as per bank e-statement
Step 2: Identify the cheques issued and deposited but not cleared. Sum them separately. These will have an entry in the books however, the status of clearance is not updated. Therefore, we have to derive the Adjusted Balance
Step 3: Derive the Adjusted Balance by adding the total amount of cheques issued to the bank balance and by subtracting total amount of cheques deposited from the bank balance
Step 4: Fetch the bank balance as per book of accounts
Step 5: Sum the amount of entries (debit and credit separately) that were not present in the book of accounts
Step 6: Derive the adjusted balance. If both the adjusted balances match, hooray! your Bank reconciliation statement is ready The tedious 6 step process can be simplified with accounting software
When one of the most tiring tasks, preparing Bank Reconciliation Statement, is brought down to one step, imagine how Gofrugal can automate other processes in your business. Actually, rather than just imagining, experience the FREE trial of Gofrugal ERP and other apps for a full month.
Avail free trialA statement prepared after tallying the bank e-statement with book of accounts is Bank reconciliation statement. Once the BRS is prepared, the book of accounts becomes accurate.
Bank Reconciliation Statement generation isn't a difficult task, yet a mandatory thing to keep your books of accounts clear. Bank Reconciliation statement can be generated easily with a accounting software connected with your POS which reconciles the bank statement with the books of accounts.
Gofrugal integrated accounting software eases the bank reconciliation statement generation with its special feature - auto BRS. In auto BRS, all you have to do is to upload your bank statement in the accounting software and watch calmly. Gofrugal accounting software will automatically match your transaction in your books of accounts with the bank statement and reconcile the transactions.
To generate your Bank reconciliation statement, all you have to do is to install Gofrugal ERP and the integrated accounting software takes care of it.