Bank Reconciliation Checklist, with a Worked Example

Bank reconciliation means comparing a bank statement with the business’s records for the same account and date. The goal is to explain every difference, not just make the totals match. The ledger, your accounting record, must contain the right transactions.

Use this checklist for one account and one statement period at a time. The numerical example is fictional, in Canadian dollars, and assumes the treatment of the illustrated fee has already been verified. Reconcile in your accounting system; Bookwits can coordinate evidence and review but is not a reconciliation engine.

1. Collect the correct statement and ledger

Confirm the legal entity, bank account, currency and period before starting. Obtain the actual statement, the ledger’s cash-account detail, the previous completed reconciliation, and supporting documents for unusual items. A downloaded transaction list may not be the same thing as a complete period-end statement.

Check that the opening balance agrees with the previous reconciliation. If it does not, investigate changed, deleted or backdated entries before proceeding. A current-period balancing adjustment will not explain an unexplained historical change.

Decide which documents to include. Note both the statement end date and the date you do the reconciliation. A later statement may confirm that a payment went through. That helps explain an item still waiting at the original date; it does not change what happened in that period. Keep accounts and currencies separate. Do not combine them to hide a difference.

2. Match transactions without creating duplicates

Match the statement to the ledger using amounts, dates and supporting references. Dates need not be identical when settlement takes time, but the difference needs a reasonable explanation. One bank deposit may represent several customer payments; one accounting payment may clear through several bank movements.

• Look for an existing invoice payment before creating a new sale from a bank-feed line.
• Confirm that a transfer is recorded in the correct accounts, not treated automatically as income or expense.
• Investigate duplicate imports, repeated amounts and reversed transactions.
• Check refunds and returned payments against their original entries.

Do not assume an automatic match is correct merely because the amount is the same. Two different transactions can share an amount. Match the identity and purpose as well as the number.

3. Work through an original balanced example

The fictional statement closes at $12,840. A $950 deposit was already recorded in the ledger but was not yet on the statement. A $700 payment was also already recorded but had not cleared. The ledger shows $13,120 before a verified $30 bank fee is recorded.

Reconciliation at the same closing date — amounts in CAD

Bank side	Ledger side
Statement balance: $12,840	Cash ledger balance: $13,120
Add deposit in transit: $950	Subtract verified unrecorded fee: $30
Subtract outstanding payment: $700	No other adjustments in this example
Adjusted bank balance: $13,090	Adjusted ledger balance: $13,090

The $950 and $700 are timing differences, not instructions to post them again. The fee needs a supported ledger entry because it was missing from the books. A bank error, if present, would require investigation with the bank rather than an invented business expense.

4. Turn unmatched items into an exception log

Keep an exception log: a list of items you cannot yet explain. For each one, note the amount, bank or ledger reference, possible reason, missing proof, person responsible and follow-up date. Mark guesses as guesses. “Possibly a duplicate import” does not mean you have confirmed a duplicate or should delete it.

A compact exception log

Issue	Evidence/action	Closure condition
Old outstanding payment	Check supplier and later clearing record	Documented settlement or approved correction
Unknown withdrawal	Request the source document securely	Purpose and posting confirmed
Possible duplicate	Compare original entries and import history	Correction with preserved audit trail

An item that remains outstanding for several periods deserves renewed investigation. Do not write it off solely because it is old or small; the appropriate action depends on the facts and the business’s policies.

5. Review the result, not just the zero difference

Confirm the closing ledger balance, the reconciliation date and the exact list of outstanding items. Recheck the underlying documents for adjustments. If the software reports a zero difference, still inspect the composition: two unrelated errors can cancel each other.

If your team allows it, ask someone who did not prepare the reconciliation to check important decisions and unresolved items. Note who prepared it, who checked it and what is still open. Moving an unexplained difference to another account does not make the reconciliation complete.

Save the final reconciliation report and the evidence required by the organization’s record-keeping and privacy obligations. If the period must be reopened, follow the system’s authorized process and review the effect on later reconciliations.

6. Make the next reconciliation easier

At the end of the cycle, identify which missing documents, late entries or duplicate feeds caused avoidable work. Assign specific preventive actions: confirm who supplies statements, clarify transfer descriptions, or review the feed-import procedure. A recurring checklist should preserve the investigation, not just repeat “reconcile bank.”

In Bookwits, a recurring task can identify the preparer, reviewer and due date; documents can organize the statement and approved report. Keep bank credentials out of task comments and limit sensitive evidence to authorized people.

The accounting system remains the source of the reconciliation and entries. The practical outcome is an explainable balance, a retrievable report and a visible plan for outstanding issues—not a green status unsupported by evidence.