How to reconcile your business bank account

Step 1: Get both sides in front of you

Open your bookkeeping and your bank statement (or live bank feed) for the same period. The goal is to confirm that every transaction in the bank appears in your books, and vice versa, with nothing missing, duplicated or mis-recorded.

Step 2: Match transaction by transaction

Work through each line, ticking off matches. Cloud software with a bank feed suggests matches automatically, so you mostly confirm rather than type. Anything unmatched — a payment in the bank not in your books, or an invoice recorded but not yet paid — needs investigating.

Step 3: Resolve the differences

Common differences are timing (a cheque not yet cleared), missing entries (a bank charge you forgot to record), and errors (a wrong amount). Post the missing items, correct the errors, and note genuine timing differences. When both sides agree, you are reconciled.

Step 4: Why it matters beyond tidiness

Reconciliation catches errors before they compound, surfaces bank charges and fraud, and confirms your cash figure is real. It underpins accurate VAT returns, credible management accounts and a balance sheet you can trust.

Step 5: Do it little and often

Reconcile weekly, not just at year end — small, frequent reconciliations are quick and keep your numbers always current, so cash decisions and finance applications rest on real figures.

Credicorp lends to your company, not to you personally, and takes no personal guarantee. See indicative terms on business loans, or apply online in minutes.