Bank reconciliations are the most common type of reconciliation. To ensure accurate accounting records, perform reconciliations on all your financial accounts. Compare each transaction in your financial statement with the same transaction in your accounting records. As you complete your reconciliation, you will add some entries such as fees, interest income or interest expense entries from the financial statement to your accounting records. Check the transactions off as you verify them as proof the transactions have cleared the financial institution. Most accounting software have a built-in way for you to perform a reconciliation and check off each cleared transaction. Accounting paper and check registers also have a column you can check off as you reconcile your account.

Catch Mistakes

A reconciliation tells you which transactions have cleared the financial institution. As you perform your reconciliation, you may encounter transactions that seem to match but with different amounts. The best way to determine whether you or the financial institution has made a mistake is to examine the original financial record. You should still have this record at the time of the reconciliation, because according to the CRA, you should keep financial record backups such as bills, receipts and deposits for a minimum of six years. If the mistake is yours, correct your mistake. If the financial institution made the mistake, call and work with it to correct your account.