Introduction

Bank reconciliation is an essential step for any company or organisation wishing to ensure that its accounts are reliable and up to date. All too often neglected or carried out too late, this regular check between bank statements and accounting entries enables errors, omissions or discrepancies to be detected quickly.

Whether you’re a very small business, an SME, an association or a school, bank reconciliation helps you to manage your cash flow more effectively, anticipate anomalies and close your accounts with greater peace of mind.

In this article, we explain what a bank reconciliation is, why it’s crucial to integrate it into your processes, and how to simplify it with the right tools.

What is bank reconciliation?

Bank reconciliation involves comparing the transactions recorded in your accounts (invoices received, supplier payments, transfers, etc.) with the transactions that actually appear on your bank statements. The aim is to check that each accounting transaction corresponds to a bank transaction and, conversely, that no transactions have been forgotten or incorrectly recorded.

This operation is carried out using a document called a bank reconciliation statement, which lists all the entries checked and highlights any discrepancies. If there are differences between the two sources (for example, a payment recorded but not yet collected), an analysis is required to justify the differences and adjust the entries if necessary.

Bank reconciliation is an essential tool for guaranteeing :

• the reliability of your accounts,
• a clear view of your cash flow,
• and an accounting close with no surprises.

It is aimed at all organisations with a regular financial activity: VSEs, SMEs, associations, schools, etc.

Why carry out a bank reconciliation?

Bank reconciliation is more than just a formality: it plays a key role in the sound financial management of your organisation. That’s why it’s essential to incorporate it regularly into your accounting practices:

Making accounting more reliable

Comparing bank statements with accounting entries ensures that each transaction is correctly recorded. This allows errors to be detected, such as duplicate entries, omissions or incorrect amounts.

Quickly identify anomalies

With bank reconciliation, you can spot payments not received, unexpected direct debits and fraudulent transactions. The earlier a discrepancy is detected, the easier it is to correct.

Improve cash flow monitoring

By checking that bank movements match your accounting transactions, you get a clear, reliable picture of your cash position. You know exactly what has been collected, what is pending and what is due.

Facilitating the closing of accounts

Regular reconciliation avoids the accumulation of errors and simplifies the monthly or annual closing of accounts. It also saves time with your chartered accountant, who benefits from clean, already validated data.

The key stages in a successful bank reconciliation

Bank reconciliation may seem technical, but by following a clear method, it becomes a simple and effective routine. Here are the main steps to follow:

1. Collect bank statements

First and foremost, you need your bank statements, ideally in digital format (PDF or CSV). These statements should cover the period to be reconciled (usually monthly).

2. Gather the corresponding accounting entries

You then need to extract the entries recorded in your accounts for the same period: supplier payments, customer receipts, internal transfers, bank charges, etc.

3. Mark operations

Each line of the bank statement must be compared with a corresponding accounting entry. This is called tallying. This makes it possible to identify what has been correctly entered and what is missing.

4. Justify differences

If there is a discrepancy between the two sources (amount, date, missing transaction), the cause must be investigated: collection delay, data entry error, transaction being processed, etc. Each discrepancy must be explained and corrected if necessary.

5. Generate a reconciliation report

Once all the transactions have been checked, a reconciliation statement is generated. This document serves as proof in the event of an audit, and certifies that the bank accounts are consistent with the accounts.

Best practices to save time

Bank reconciliations can be time-consuming if done manually or irregularly. Here are a few best practices to simplify it and make it an efficient routine:

Adopt a regular frequency

Rather than waiting until the end of a quarter or a financial year, it is better to carry out a bank reconciliation every month, or even every week if there is a large volume of transactions. This avoids oversights and enables any discrepancies to be corrected quickly.

Involving your accountant

If you work with an accountancy firm, reconciliation can be made easier by sharing access to documents and statements, or by using a collaborative tool. Good communication avoids unnecessary back and forth.

Use a pre-accounting solution like Azopio

Automation is a real productivity lever: with a solution like Azopio, you can :

• connect your bank accounts (via our partner Powens),
• automatically import bank flows into your account,
• automatically associate supporting documents with transactions,
• and track reconciliations in real time.
  

You save time, reduce errors and simplify the preparation of reconciliation reports.

Azopio, a solution to simplify bank reconciliation

Bank reconciliation shouldn’t have to be a monthly chore. Azopio makes this task simple, smooth and automated. Here’s how our platform can help you every day:

Direct connection to bank accounts

Azopio lets you connect your bank accounts in complete security via Powens, an approved partner. More than 2,000 banks in France and Europe are compatible, both traditional banks and neo-banks.

Automatic import of transactions

Once you’ve logged in, your bank feeds are automatically synchronised in your Azopio space. You no longer have to download your statements manually.

Intelligent reconciliation with receipts

Azopio associates each transaction with the corresponding accounting document: purchase invoice, sales invoice, receipt, etc. All you have to do is validate the reconciliations, which minimises oversights and errors.

Clear monitoring and dashboards

From your interface, you can easily view :

• reconciled or pending operations,
• missing supporting documents,
• your cash position, debts and receivables.

Your chartered accountant can also access this data in real time, strengthening collaboration.

Conclusion

Bank reconciliation is a cornerstone of financial management: it guarantees the reliability of your accounts, provides better cash management and facilitates collaboration with your chartered accountant. All too often still seen as a tedious task, it can be greatly simplified with the right tools.

With Azopio, you can automate the retrieval of your bank flows, associate them with your supporting documents and monitor your activity in real time. The result: considerable time savings, fewer errors and always up-to-date accounting.

Try out Azopio and discover how to make your bank reconciliations easier, step by step.