A periodic document issued by a bank summarizing all transactions (deposits, withdrawals, fees, interest) in an account over a specific period.
Bank statements serve as the official record of all account activity and are essential for bank reconciliation, tax filing, and financial auditing. They typically include opening balance, each transaction with date and description, running balance, and closing balance. Digital bank statements (e-statements) are now standard, and modern accounting software can auto-import bank statements via Open Banking APIs or file uploads (CSV, OFX, MT940 formats).
A monthly bank statement for April shows: Opening Balance ₹2,50,000, 45 transactions (credits + debits), Closing Balance ₹3,15,000. The business uses this to reconcile with their accounting records.
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Monthly at minimum, weekly for high-volume businesses. Modern cloud accounting software like Laabam.One can auto-reconcile daily using bank feed integrations.
Common causes include timing differences (cheques issued but not cleared), bank charges not recorded, direct debits not entered, and errors in either system. A bank reconciliation statement identifies and resolves these differences.
The process of comparing and matching a company's accounting records with its bank statement to identify and resolve any differences.
The net amount of cash and cash equivalents moving into and out of a business during a specific period.
The master accounting record that contains all financial transactions of a business, organized by account.
Money owed to a business by its customers for goods or services delivered but not yet paid for.
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