Bank Reconciliation


As a small business owner in Australia, bank reconciliation is part of life; it ensures your bookkeeping is accurate and helps to lessen your tax burden. Bank reconciliation can also allow you to track costs and alert you to fraud or theft. The process of bank reconciliation is matching the information on a cash account bank statement to balances in your accounting records. The aim is to spot any differences between them and to book the changes to the accounting records. You will lessen the chances of overdraft fees or dishonoured cheques by doing a bank reconciliation regularly for all bank accounts.


At BYO Group, you’ll have a dedicated account manager to oversee all of your business needs, whilst providing you with ongoing support and advice.


Bank Reconciliation Statement

A bank reconciliation should be carried out at least after the end of every month when your bank sends you a statement with the starting cash balance, monthly transactions and an ending cash balance. If done daily, you can detect and correct problems straight away. Always print a bank reconciliation statement or report using your accounting software to show the bank statement and book balances, the differences between them (usually uncleared cheques), and any other unreconciled differences.

Bank Reconciliation Steps

The steps to take when doing a bank reconciliation start with locating the bank’s ending cash balance, then adding any deposits in the pipeline from the business to the bank, subtracting uncleared cheques, and either adding or subtracting any other items. Then, go to the ending cash balance and deduct any bank service fees and penalties, and add earned interest. If you’re using Xero software, the process is much easier. So, the bank reconciliation steps would be:

  1. Locate bank records
  2. Locate business record
  3. Locate your starting point
  4. Check through bank deposits
  5. Check your income on the books
  6. Check bank withdrawals
  7. Check all expenses on the books
  8. Locate end balance


 BYO Group is committed to providing tailored bookkeeping solutions for all your business needs, giving you peace of mind that everything is being handled according to the proper standards.


Bank Reconciliation Accounting

Bank ReconciliationBank reconciliation accounting looks for these items:

  • Cheques and deposits in the bank records of different amounts to business records.
  • Cheques in the bank records not recorded at all in the business records.
  • Deposits recorded in the bank record not recorded at all in the business records.
  • Inbound wire transfers whose fees haven’t been taken out.

Xero Bank Reconciliation

Bank reconciliation can be a challenging task, but Xero software can get it done much faster. Your bank can send transaction data directly to your Xero accounting software through a secure online connection. Xero connects with many banks worldwide, so there’s a good chance your bank in Australia is one. When you’re ready to do the reconciliation, the software can extract each bank transaction and either:

  • Ask what the transaction was for and enters the info into your account, or
  • Suggests a match with another entry.

Bank reconciliation accounting can be monotonous and time-consuming, so if you’re wondering, ‘Is there someone nearby or near me who can do this?” why not give BYO Group a call on 0402 100 421? Alternatively, you can fill in the convenient online form, and we’ll get back to you. We’re here to help.


The ongoing support from BYO books has just been fantastic. Diane and her team is extremely responsive and reliably intuitive to my needs, demonstrating their commitment to great customer service and their superior knowledge base on bookkeeping issues and how to use Xero to full advantage.

I have no hesitation in recommending Diane and her team at BYO Books to any business needing a responsive and reliable bookkeeping service.

Alison McWhirter Photography

We were using a manual Excel system of record keeping prior to working with BYO Books. Diane made the transition to Xero as seamless as possible without too much stress or work from me.  We now use Receipt Bank and she manages everything remotely. Our records are always up to date and I can request any report I like and she usually sends it within a couple of hours. The service level is excellent and we are always compliant with all tax and employer  obligations. I only wish I had made the change to BYO Books years ago as I now have more time to run my business rather than being the bookkeeper for it.

Pure Distillery Company – Dean Lucas

After many years of unreliable reactive bookkeeping we were thrilled to find Diane McCaffrey and her team at BYO Bookkeeping Services. Diane assisted us in developing a systemised, time efficient and proactive bookkeeping system for our small business. I find Diane and her team to be highly professional and efficient and a true pleasure to work with. And she is a great bookkeeper: diligent and detail oriented, down to the last penny. Diane continues to be an integral part of our success and we truly value and are grateful for our association with her.

Eat Play Thrive – Vicky Kuriel