What is bank reconciliation statement in accounting

A Bank Reconciliation Statement (BRS) is an accounting summary used to match the cash balance in a company’s internal records with the balance reported on its bank statement. It helps identify and resolve discrepancies caused by:

• Timing differences, such as cheques issued but not yet cleared or deposits in transit.
• Bank-specific entries like service charges, interest, or direct debits not yet recorded in the ledger.
• Manual errors in data entry or recording.

This process ensures financial accuracy, aids in fraud detection, and supports effective cash flow management.