12-09-2017, 10:23 AM
The reconciliation of accounts is one of the most common, but important, actions taken for managerial accounting. It is important to reconcile balance sheet accounts at the end of a period (month, quarter or year-end) as part of the closing process. Doing this helps identify errors before closing. The reconciliation of the balance sheet account is the comparison of the balance of proof of the ledger of the account with another source, whether internal, as a sub-unit, or external, as a bank statement. Differences caused by the timing of transactions, such as outstanding checks, are identified as reconciling items.
When you prepare for a reconciliation of the ledger of an account to an aging different accounting books are used. Cash accounts are reconciled with a bank statement. Accounts receivable and accounts payable are reconciled with the aging programs. Inventory and fixed assets can be reconciled with a physical count.
When you prepare for a reconciliation of the ledger of an account to an aging different accounting books are used. Cash accounts are reconciled with a bank statement. Accounts receivable and accounts payable are reconciled with the aging programs. Inventory and fixed assets can be reconciled with a physical count.