Financial Education | Financial tools for reporting the monetary and cash resources of business entities

The purpose is to compare the movements recorded by the bank with those recorded in the accounting records of the entity or organization, in order to ensure the veracity of the balance and reveal any errors or unrecorded transactions.

In this way, the management of monetary and cash resources can inform the entity about the movement of account balances, as well as checks drawn by the company that have not been cashed by the payee of the check. Debit memos that the bank has debited the bank account and that the company has not recorded in its subsidiary.

Another form of financial information is the credit notes that the bank has credited to the company's account and that the company has not yet recorded in its subsidiary ledger, as well as errors made by the company when recording items and values in the subsidiary ledger, and errors made by the bank when settling certain items.

In accordance with the above, reconciliations should be performed within ten working days of the following month, allowing the accounting management to examine the processes and apply internal controls that contribute to an efficient management of current assets.

For such purposes, it is necessary to apply methods or methodologies that include the evaluation of balances due to their impact on finances, cash availability and compliance with the commitments inherent to the commercial activity.