Bank Reconciliation Statement

A bank reconciliation statement is a statement prepared by a company to reconcile the difference between the balance as per the company's cash book and the balance as per the bank statement. It helps in identifying any discrepancies or errors that may have occurred in the banking transactions.

Steps to Prepare a Bank Reconciliation Statement:

1. Compare the Cash Book and Bank Statement:
- Compare the closing balance as per the cash book with the closing balance as per the bank statement.
- In this case, the closing balance as per the cash book on March 31, 2019, is ₹72,950.

2. Identify Outstanding Cheques:
- Determine the cheques issued by the company but not yet presented for payment by the bank.
- In this case, the cheque for ₹29,344 was not presented for payment.

3. Identify Unpresented Cheques:
- Determine the cheques deposited by the company but not yet cleared by the bank.
- In this case, the cheque for ₹43,769 was not collected by the bank.

4. Adjustments for Outstanding and Unpresented Cheques:
- Deduct the amount of outstanding cheques from the closing balance as per the cash book.
- Add the amount of unpresented cheques to the closing balance as per the cash book.
- In this case, deduct ₹29,344 and add ₹43,769 to the closing balance.

5. Compare Adjusted Cash Book Balance and Bank Statement Balance:
- Compare the adjusted closing balance as per the cash book with the closing balance as per the bank statement.
- In this case, the adjusted closing balance as per the cash book is ₹86,375 (₹72,950 - ₹29,344 + ₹43,769).

6. Identify Other Discrepancies:
- Check for any other discrepancies such as bank charges, interest received, or errors in recording transactions.
- If any discrepancies are found, make the necessary adjustments in the bank reconciliation statement.

7. Prepare the Bank Reconciliation Statement:
- Prepare a statement showing the reconciled balance as per the cash book and the bank statement.
- In this case, the bank reconciliation statement will show the adjusted closing balance as per the cash book (₹86,375) and the closing balance as per the bank statement.

Bank Reconciliation Statement for Ramesh:

Closing balance as per the cash book on March 31, 2019: ₹72,950
Outstanding cheques: ₹29,344
Unpresented cheques: ₹43,769

Adjusted closing balance as per the cash book: ₹86,375

Bank Reconciliation Statement:

Closing balance as per the cash book: ₹86,375
Closing balance as per the bank statement: ₹72,950

Difference: ₹13,425

Explanation: The difference of ₹13,425 represents the discrepancies between the cash book and the bank statement. It could be due to bank charges, interest received, or errors in recording transactions. Further investigation is required to identify and rectify the exact cause of the discrepancy.

Conclusion:

A bank reconciliation statement is an