What is Bank Reconciliation ? How to do with Tally?

What is Bank Reconciliation?

Usually Businessman or Employer has lot of bank transaction every day.

He may not able to go bank everyday to check how much amount credited/how much debited, so he will prepare cash book.

In that cash book he will record all the transaction related to bank.

Usually Passbook prepared by Banker and cash book prepared by Businessmen/the person who is having high banking transaction every day.

If there is any mismatch amount came in between cashbook and passbook then reconciliation needed to find where the mistake is happend, called Bank Reconciliation. 

What are the major reasons for mismatch of balance?

• you sent cheque to bank but that is dishonoured  due to some reasons like signature mismatch, crossed valid date, etc but this time you may not aware about those things will happen, you will usually record in your cash book as cheque is debited or credited
• Bank interest on your deposit credited by bank, But you may not  aware about that, so usually in passbook bank amount will increase but not in cash
• Bank charges or some other amount debited by bank,but those things you may not aware etc.

Tally is the most convenient Software for all accounting work like recording purchase,  sales, payment, receipts, advance payment, GST calculation, TDS calculation, preparation of company balance sheet, Auditing, Profit and Loss a/c etc.

Usually while doing Reconciliation with Tally we will concentrate on the date of payment from Tally entry and date of payment from bank entry.   

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