My bank statement and my books do not match. How do I find the difference?

Start with the same date on both sides: the bank statement closing balance and the bank ledger balance as on that day. The gap is almost always one of a few timing or recording differences.

• Cheques issued but not yet presented: recorded in your books, not yet debited by the bank.
• Cheques or deposits not yet credited: recorded in your books, not yet credited by the bank.
• Bank charges, interest and auto-debits: on the statement but not yet entered in your books.
• Wrong or duplicate entries: an amount typed incorrectly, or the same receipt entered twice.

Tick off each statement line against a books entry for the period. What remains unticked on either side explains the difference. Enter the missing charges and interest in your books, and keep the pending cheques listed in a bank reconciliation statement until they clear. If a difference remains after this, check the opening balance, as an error carried over from an earlier month is a common cause.