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Entrepreneurs should get into the habit of doing bank reconciliation reports before any time they make financial decisions in their business says Edmonton bookkeeping. But it is not just important for entrepreneurs to do reconciliation, they also should be ensuring that they are taking the time to do it well, by utilizing several double-check systems along the way to verify the accuracy of the information in the report. Without adding these important double-check systems throughout the process, business owners cannot possibly ensure that they are creating a report that is accurate enough to base financial decisions on. Adding important double checks along the way does not add significant amounts of time to the reports, but can significantly enhance the report.

There are three things that business owners should have before they start their bank reconciliation report to each month. Edmonton bookkeeping says that they need to have their current bank statement, their last bank reconciliation report, and a list of all of the checks that they have written in the past month. They should start the report by verifying the accuracy of the information. If they compare the previous bank reconciliations final balance to the current bank statements opening balance, they can ensure that they are starting off the bank reconciliation report in the correct spot. Continuity of the information is extremely important for business owners, therefore if they can verify that they are starting this report in the right place, they can ensure its accuracy overall. If they do not do this important check, they are not going to end up with the correct report no matter how hard they try.

Business owners should also be verifying the information that they have at the end of the report. It is not just important to do double-check at the beginning, but if they do a double-check at the end, it can significantly help them ensure that they did the report properly. Edmonton bookkeeping says that the way they would verify it is by comparing the ending balance of the report with the ending balance of their statement. If they verified that is correct, the next thing they need to do is to look at the registered balance. The registered balance should match on their balance sheet, the GL for their bank. If those two items are the same, business owners can verify that they have done the bank conciliation properly.

Entrepreneurs next bank reconciliation report, they should start the exact same way, by verifying the report is the same. Since entrepreneurs have already done that verification at the end of the report, they do not understand the importance to do it again. However, if there were any additional transactions that snuck through after they finished the reconciliation report the last time, it could cause amounts to be slightly out. They should verify the ending balance of the reconciliation report should match the opening of their current bank account so that they can sure once again to start their reconciliation report correctly.

Financial decisions are an extremely important aspect of business ownership says Edmonton bookkeeping. Therefore, business owners should be extremely careful that they are ensuring that whatever financial decision they are making, it is in their business is the best interest. Whether they are paying staff, paying bills, making purchases or even paying themselves dividends, doing so by understanding how much money they have to work within their business can help entrepreneurs make great financial decisions. If entrepreneurs are depending solely on the bank statement that they have, they can end up making decisions that could cause them problems, because what is listed in the bank statement is not necessarily the money that they have to use. Bank statements do not show the state of money a business has, just how much money is in the bank account that particular moment and if there are any payments scheduled such as disbursements, you transfer, or checks that are uncashed, business owners will not have an accurate reflection of how much money they have to work with.

Bank reconciliation reports, on the other hand, show an entrepreneur how much money they have in their business after they have to take into consideration all of the various payments and disbursements that are scheduled to come out. It is not only important that business owners have a report of all the money that they have access to that they can make financial decisions with, but the accuracy of those reports is paramount as well in order for business owners to know exactly how much money they have in their business in order to utilize. Therefore, learning how to do a bank reconciliation report well can help entrepreneurs significantly in their financial decision-making processes.

One of the most important things that entrepreneurs might not do when it comes to their reconciliation report, is to double-check all of the transactions. Whether they have entered in all of the transactions manually, or if there using software like QuickBooks online has an automated feature that allows all transactions to be automatically populated into the software, Edmonton bookkeeping says that business owners need to always be verifying the information. Many entrepreneurs do not understand why they would have to do a double-check system if there using the automated processes, but even with double checking each transaction against the statement, the automated system is faster and easier and more accurate than manual updating.

Once an entrepreneur has verified the accuracy of the information that they have entered, do not end up with the report, that they should as well double-check. Edmonton bookkeeping says that business owners should ensure that the ending balance matches their statements and if that is the same, the next thing that they should check is their balance sheet. If the GL for their bank matches their registered balance on their reconciliation report is owners can be assured that they have done the bank reconciliation report correctly, and can then use it in order to make financial decisions in their business.