Bank Reconciliation Statement (BRS)

Name: Bank Reconciliation Statement (BRS)
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Bank Reconciliation Statement (BRS) topic for students and learners

Created byCA Nilesh Phadke

Last updated 12/2022

English

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What you'll learn

Meaning of Bank Reconciliation Statement (BRS)
Reason for Differences between Bank Column of Cash Book and Bank Pass Book
How to Solve BRS Problems under different scenarios as follows: 1) When Balance as per Company's Book is given, 2) When balance as per Bank Pass Book is Given.
How to Solve BRS Problems under : 1) When Negative Balance as per Cash Book is given, 2) When Negative balance as per Bank Pass Book is Given.

Course content

1 section • 7 lectures • 57m total length

BRS : When Positive Cash book balance given example 18:04
Learn to prepare a bank reconciliation statement when the cash book shows a positive balance and determine the bank passbook balance through reconciling entries.
BRS When positive cash book balance given example 29:14
Determine the bank passbook balance from a positive cash book balance using reconciling items like deposits in transit and outstanding checks. This example guides preparing a bank reconciliation statement.
BRS when negative cash book balance given9:02
Learn to prepare a bank reconciliation statement when cash book shows a negative balance or overdraft, reconciling with the bank passbook and identifying differences between cash book and passbook.
BRS when positive pass book balance given7:13
Learn to prepare a bank reconciliation statement when a positive passbook balance is given. Reconcile the company's cash book with the bank statement using cheques, deposits, withdrawals, and charges.
BRS when negative pass book balance given8:18
Prepare a bank reconciliation when the passbook shows a negative balance. Reconcile passbook and bank column of cash book differences using charges, uncredited deposits, and dishonoured bills.
BRS : when Company Book and Pass Book both are Given9:25
Learn to prepare a bank reconciliation statement when cash book bank column and passbook are given, distinguishing cleared from uncleared items and calculating the opening balance.
BRS when Company books need to be rectified based on Pass book6:03
Learn how to prepare a bank reconciliation statement by rectifying the company's cash book based on the bank passbook, reconciling differences between cash book and bank statement.

Requirements

No Previous Background is required

Description

Bank Reconciliation Statement is very important when one studies accountancy.

Company incurs many transactions during any particular period which involves bank. For example company makes payment to supplier through bank, Company makes payment of salary to employees through bank, company makes rent payment through bank etc. It records these transactions in its own books usually recorded in Cash book under Bank Column. Similar transactions also get reflected in Bank Pass Book (also called as Bank Statement) of the company. Hence balance as per Company's own books and Company's Bank Pass Book should ideally be same. But this is not the case always and end balances as on particular date under both the books varies and hence bank reconciliation statement is prepared to reconcile these differences.

Below are the main reasons for differences between 2 books i.e. company's own books and Company's Bank Pass Book.

1. Company made payment to supplier through bank may be by cheque and thus records it in its own book but supplier have not deposited the same in the bank and it is thus not getting reflected in Company’s Bank Pass Book and hence difference arises.

2. Company made payment of salary to employees through bank may be by cheque and thus records it in its own book but employee have not deposited the same in the bank and it is thus not getting reflected in Company’s Bank Pass Book and hence difference arises.

3. Bank Levies some charges and hence same is reflected in Company’s Bank Pass book but as a company we are not aware of this charges and hence same is not reflected in our own book and hence difference arises.

4. Bank gives interest on deposits and hence same is reflected in bank pass book of company but as a company we are not aware of these income and same is not reflected in company’s own book and hence difference arises.

5. Sometimes mistake is made by either party and hence difference between two books arises.

With the help of simple mathematics we will learn through this video series how to prepare bank reconciliation statement basically under below 4 scenarios :

1. When balance as per Bank Column of Cash Book is Given.

2. When balance as per Bank Pass Book is Given.

3. When negative balance (overdraft) as per Bank Column of Cash Book is Given.

4. When negative balance (overdraft) as per Bank Pass Book is Given.

Who this course is for:

Learners of Bank Reconciliation Statement, XI Standard Commerce Students