12 reasons why every business should review its bank statements

 What a  good practice to review your business bank statements monthly. Check out these reasons.

1. Anything unusual- Are there transactions in your statement that you didn't perform?  Or you performed, but you were either debited or credited twice?

2. Bank charges- Add them up and include them as expenses in the accounts. Also review that they are reasonable, compared to the volume of transactions that occurred in the month.

3. Cheques- Did you lodge any cheque and it didn't get value? Maybe it bounced and no one called you? Did you issue any cheque and the beneficiary hasn't drawn it?

 

4. Bank reconciliation- Your accountant performs this activity every month.  It is a simple process that agrees with your accounting software entries with the bank statement.

5. Cash sales- Did all your cash sales arrive in the bank? Add up your cash sales register, take out any expenses made from cash sales. Does the balance agree? 

 

6. Direct-paying-customers - Some customers just make payments to your bank accounts without informing you. What if you received no SMS alert? How do you avoid embarrassing them, calling them to make payment, when they already did?

7. Bulk payment uploads may experience some bounce-backs- Imagine that you paid 40 suppliers by upload, 2 of them had wrong account numbers and their monies bounced back to your account.

 

8. Drawings from Debit Card - Does your business have a debit card used for petty cash expenses?  Do the drawings made by the team, agree with the petty cash records?

9. Payment gateway settlements- Do you use any e-payment options to accept payments from customers? Like Interswitch, Paystack or Flutterwave? Have all your payments been settled?

    Can you calculate the charges, since you now know the net figures paid to you?

10. POS-transactions- Do you have POS hardware devices used in accepting payments from your customers? Have all your monies been settled? Can you now calculate the charges on POS transactions?

 

11. POS chargebacks - Did a customer make a report and the bank posted a charge-back against any POS transactions?
12. Other bank transactions- Did you perform an LC or APG transaction with the bank? What charges did they hit on your account? You should take those to an expense account.

 

No matter the size of your business, the first few days into a new month, every business should get its bank statements and perform a detailed review.

You now know the reasons why.

After the review, store the bank statement, preferably in soft copy.

By: Zeiroz Accountants Hub