Bank Reconciliation

Bank reconciliation is the process of matching your recorded transactions with your bank statement to ensure accuracy and identify discrepancies.

Why Reconcile?

Benefits:

• Ensure all transactions recorded
• Detect errors or fraud
• Identify missing transactions
• Accurate cash position
• Bank charges accounted for
• Financial statement accuracy

[SCREENSHOT: Bank reconciliation interface]

Reconciliation Process

Step 1: Access Reconciliation

1. Navigate to https://accounting.digit-tally.io
2. Click Bank Reconciliation in sidebar
3. Select bank account to reconcile
4. Select statement period (e.g., January 2026)

[SCREENSHOT: Select account and period]

Step 2: Enter Statement Balance

Enter closing balance from bank statement:

Field	Description
Statement Date	Last date on bank statement
Closing Balance	Ending balance per bank
Statement Reference	Bank statement number

Example:

Statement Date: Jan 31, 2026
Closing Balance: NGN 2,347,500
Statement Reference: JAN2026-001

[SCREENSHOT: Enter statement balance]

Step 3: Match Transactions

System shows:

• Your Records - Transactions you've recorded
• To Be Matched - Unmatched items

Matching:

1. Review each transaction in your records
2. Find matching item on bank statement
3. Check the box to mark as reconciled
4. Enter bank date if different

[SCREENSHOT: Transaction matching interface]

Step 4: Identify Discrepancies

Common Discrepancies:

Type	Description	Action
Bank Charges	Fees not yet recorded	Add transaction
Interest	Interest earned	Add transaction
Deposits in Transit	Deposits not yet cleared	Mark as uncleared
Outstanding Checks	Checks not yet cashed	Mark as uncleared
Errors	Recording mistakes	Correct entry
Missing Transactions	Not recorded	Add transaction

[SCREENSHOT: Discrepancies list]

Step 5: Add Missing Transactions

For items on bank statement but not in your records:

1. Click Add Transaction
2. Select type:
   • Bank Charge
   • Interest Earned
   • Direct Debit
   • ATM Withdrawal
   • Other
3. Enter amount and description
4. Save transaction
5. Mark as reconciled

[SCREENSHOT: Add transaction form]

Step 6: Reconcile

After matching all items:

Reconciliation Summary:

Your Book Balance:        NGN 2,350,000
Add: Deposits in Transit:    NGN 50,000
Less: Outstanding Checks:    -NGN 52,500
Adjusted Balance:         NGN 2,347,500

Bank Statement Balance:   NGN 2,347,500

Difference:                      NGN 0 ✓

If Difference is NGN 0: ✅ Reconciliation complete ✅ Click Complete Reconciliation ✅ Generate reconciliation report

If Difference is NOT NGN 0: ❌ Review unmatched items ❌ Check for errors ❌ Find missing transactions

[SCREENSHOT: Reconciliation summary]

Reconciliation Reports

Reconciliation Statement:

• Book balance
• Bank balance
• Reconciling items
• Adjusted balance
• Uncleared items

Export:

• PDF for filing
• Excel for analysis
• Email to accountant

[SCREENSHOT: Reconciliation report]

Best Practices

1. Reconcile Monthly - Don't fall behind
2. Use Bank Statements - Official statements, not online balance
3. Match Carefully - Verify amounts exactly match
4. Investigate Discrepancies - Don't ignore differences
5. Keep Documentation - File bank statements and reconciliation reports
6. Review Bank Charges - Ensure they're reasonable

Common Issues

Issue: Large Discrepancy

• Solution: Review last month's reconciliation. Check for duplicated transactions. Look for transposed numbers.

Issue: Can't Find Transaction

• Solution: Check date range. Look in different bank account. Verify transaction wasn't deleted.

Issue: Transaction Amount Doesn't Match

• Solution: Check for partial payments. Verify amount on bank statement. Edit transaction if incorrect.

What's Next?

• Profit & Loss - Generate financial reports
• Reports Overview - All available reports

Monthly Habit

Make bank reconciliation a monthly ritual on the first week of each month. This habit prevents errors from accumulating and keeps your finances accurate.