Prepare a bank reconciliation statement
Reconcile the corrected cash-book balance to the bank statement using timing differences and bank errors.
Section 3.3 · Bank reconciliation
Cambridge IGCSE Accounting 0452 / (9–1) 0985, 2027–2029 Version 1. These lessons follow the 2027–2029 syllabus only; the separate 2026 syllabus update is not yet mapped. Written practice is self-checked, not an official Cambridge grade. Full timed-paper practice and human subject-teacher review remain pending.
Before you begin
- No previous accounting study is assumed. Keep the business, transaction and accounting period in view, and distinguish a resource, a claim and a performance result.
Work on paper. Try each question before revealing help, and explain why your method works.
Quick readiness check
Why can a cash-book receipt be absent from the bank statement at month-end?
What you will learn
- Explain why bank and cash-book balances differ
- Prepare a reconciliation with unpresented cheques and uncredited deposits
- Treat a bank error without changing the cash book incorrectly
Separate timing from recording errors
An unpresented cheque has been entered as a payment in the cash book but has not yet been processed by the bank. Starting from the corrected cash-book balance, add it to predict the statement balance.
An uncredited deposit has been entered as a receipt in the cash book but is not yet on the statement. Starting from the corrected cash-book balance, subtract it to predict the statement balance. A bank error is adjusted according to the direction of the bank's mistake.
Check the result against the statement
First update the cash book for charges, interest, credit transfers, direct debits, standing orders and the business's own errors. Then reconcile the corrected balance for timing items and bank errors.
A digital payment may be pending, rejected or completed. Use the correct status and date, avoid duplicates and retain evidence. Reconciliation helps find differences; it does not alone prove that every transaction is authorised or classified correctly.
Pause and explain
From a corrected cash-book balance of $1,800, unpresented cheques are $250 and uncredited deposits are $130. What statement balance is expected, ignoring bank errors?
Worked example
The corrected cash-book balance is $2,440 positive. Unpresented cheques total $220, uncredited deposits total $310, and the bank wrongly debited the account by $50. Find the balance currently shown on the statement, before correction.
Show the worked solution
- Start from corrected cash book: $2,440.
- Add unpresented cheques $220; subtract uncredited deposits $310 and the bank's erroneous $50 debit.
- 2,440 + 220 − 310 − 50 = $2,300.
Answer The statement currently shows $2,300 positive. Once the bank corrects its $50 error, the reconciled balance will be $2,350.
Try a topic test
Choose Easy, Normal or Difficult. Save your answers and open worked review after finishing.
Test this topic →From guided practice to a new situation
Write your answer and reasoning first. Use a hint only if you are stuck. The model solution is for self-checking; your written work is not automatically marked.
Corrected cash book is $3,100 positive. Unpresented cheques are $420 and a deposit of $260 is uncredited. Calculate the expected bank-statement balance.
Give me a hint
From cash book to statement, add payments not yet processed and subtract receipts not yet credited.
Compare my reasoning
- Add $420 unpresented cheques.
- Subtract $260 uncredited deposit.
- 3,100 + 420 − 260 = $3,260.
Expected statement balance: $3,260 positive.
Look for these in your work
- Cheque direction correct
- Deposit direction correct
- Balance correct
Corrected cash book is $1,250 positive. There is an unpresented cheque of $180, an uncredited deposit of $90 and a bank error that wrongly credited the business by $40. Find the statement balance before correction.
Give me a hint
A mistaken bank credit makes the statement higher than it should be, so include it when finding the balance currently shown.
Compare my reasoning
- Add the unpresented cheque: +180.
- Subtract the uncredited deposit: −90; include the erroneous bank credit: +40.
- 1,250 + 180 − 90 + 40 = $1,380.
The statement shows $1,380 before the bank corrects its $40 over-credit.
Look for these in your work
- Timing items signed correctly
- Bank error direction correct
- Result correct
A card settlement is shown as pending in the payment app but is absent from the bank statement. What should the bookkeeper check before treating it as a completed receipt?
Give me a hint
A pending digital status may not be the same as a completed bank credit.
Compare my reasoning
- Check settlement status, expected processing date and any fees.
- Compare the amount and reference with the cash-book entry and bank statement.
- Keep it as a timing item or investigate a rejected transfer; do not record the same receipt twice.
Confirm whether the settlement completed. If it is only pending, retain the timing difference and follow up; avoid a duplicate cash-book entry.
Look for these in your work
- Completion status checked
- Evidence matched
- Duplicate risk addressed
Common mistakes
- Updating the cash book for unpresented cheques
- Adding an uncredited deposit when reconciling from cash book to statement
- Treating a bank error as a transaction authorised by the business
What can you explain now?
Starting from a corrected cash-book balance, how does an unpresented cheque affect the expected statement balance?
Compare with the explanation
Add the unpresented cheque
The cash book has already deducted it while the bank statement has not.
After trying it yourself, choose your next review. This is your self-assessment.
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Make it stick
When starting from the corrected cash book, which way do unpresented cheques and uncredited deposits move the expected statement balance?
If you needed the solution, close it and solve the problem again from a blank page. A correct answer is stronger when you can explain the reason for each step.