To reconcile a checking account, compare your check register to the bank statement line by line, tick every item that appears on both, and record any fee or interest the register lacks. Then take the statement balance, subtract the checks that have not cleared, add deposits not yet credited, and confirm the result equals your register balance.
What a checking account register must show before you reconcile
A checking account register is the running record of every payment and deposit you made, and it must show a date, a reference, a payee or source, an amount and a running balance. Without those five columns there is nothing to tick against the statement and no balance to prove.
The columns
- Date. The day you wrote the check, swiped the card or made the deposit.
- Reference. The check number, or a short code such as DC for debit card, ATM, or XFER for a transfer.
- Payee or source. Who got the money or who sent it.
- Payment and deposit amounts. Two columns, or one signed column.
- Running balance. Recalculated after every line.
- Cleared mark. An empty box to tick during reconciliation.
Check the register before the statement
A reconciliation proves the register against the bank. If the register itself has arithmetic mistakes, you will chase differences that come from your own addition. Two quick checks help before you begin:
- Recompute the running balance. Add or subtract down the page for the month. A transposed digit, such as 54.30 written as 45.30, throws everything below it off.
- Confirm the starting balance. The register should open the month at the balance you proved last month. If last month was never reconciled, see the section on missing registers below.
Also confirm the statement foots: the opening balance plus deposits less withdrawals should equal the closing balance printed on it. If it does not, ask the bank for a corrected copy before spending time on the register.
The equation you are proving
Every checking account reconciliation proves one equation. The bank's closing balance, less checks and payments that have not cleared, plus deposits not yet credited, equals the register balance after you have recorded the bank's fees and interest. Everything else in this post is a way to find the lines that make that equation fail. For the meaning behind it, see what reconciliation in bank accounts means for your books, and for the general method with a tickmark legend, how to reconcile bank statements in seven steps.
Ticking cleared checks and debit card lines in the checking account
To tick items, read the statement one line at a time, find the same amount in the register, and mark both with a tick. Work from the statement toward the register so that nothing on the statement is skipped. Whatever has no tick at the end is either outstanding or missing.
The method
- Open the statement and the register side by side.
- Take the first statement line. Find it in the register by amount and by check number or date.
- Tick the statement line and the register line. Use one mark for "agrees" and write a different note when the amounts differ.
- Continue to the end of the statement.
- List every register line with no tick. These are your candidates for outstanding checks and deposits in transit.
- List every statement line with no register partner. These need to be recorded.
Checks are the easiest to match, because the number is printed on the statement. Debit card lines are harder. A card purchase is often recorded on the day you made it and posted by the bank a day or two later, and the descriptions on the statement may show a processor name and not the shop you remember.
A register excerpt, reconciled
The excerpt below is an example for a March statement. All values are made up. A tick means the line appears on the statement. Both checks without a tick are outstanding.
| Date | Ref | Payee or source | Payment | Deposit | Balance | Cleared |
|---|---|---|---|---|---|---|
| 03-01 | DEP | Paycheck | 1,850.00 | 5,050.00 | tick | |
| 03-02 | 2101 | Landlord | 1,200.00 | 3,850.00 | tick | |
| 03-04 | DC | Grocery | 86.40 | 3,763.60 | tick | |
| 03-06 | ATM | Cash | 100.00 | 3,663.60 | tick | |
| 03-09 | 2102 | Electric | 94.15 | 3,569.45 | tick | |
| 03-12 | XFER | To savings | 300.00 | 3,269.45 | tick | |
| 03-15 | DC | Fuel | 42.00 | 3,227.45 | tick | |
| 03-18 | 2103 | Dentist | 175.00 | 3,052.45 | outstanding | |
| 03-22 | DC | Pharmacy | 23.50 | 3,028.95 | tick | |
| 03-28 | 2104 | Auto insurance | 210.00 | 2,818.95 | outstanding | |
| 03-30 | DEP | Deposit | 420.00 | 3,238.95 | tick |
The register opened the month at 3,200.00, and the statement shows the same opening balance. The bank also charged an 8.00 monthly fee that is not in the register.
The reconciliation of that excerpt
| Line | Example amount |
|---|---|
| Closing balance per bank statement | 3,615.95 |
| Less: check 2103 outstanding | (175.00) |
| Less: check 2104 outstanding | (210.00) |
| Adjusted bank balance | 3,230.95 |
| Register balance | 3,238.95 |
| Less: bank fee not yet recorded | (8.00) |
| Adjusted register balance | 3,230.95 |
| Difference | 0.00 |
The adjusted balances agree, so the account is reconciled. The only entry to make in the register is the 8.00 fee. The two checks need no entry, because they are already recorded and will clear in April. The formal layout for this page is explained in the bank reconciliation statement format.
When the amounts differ
A transposition is the usual cause when a tick refuses to settle. If the statement shows 94.15 and the register shows 91.45, the digits are swapped or one is miskeyed. Count the difference in cents and divide it by 9: here 270 cents gives 30. When the result is a whole number, a swapped pair of digits is likely. Correct the register, not the statement, unless the bank clearly erred.
Checks that stay outstanding for a long time need attention of their own. The treatment of old uncleared checks is covered in aging outstanding checks and when a check goes stale.
How do you handle checking account transfers and ATM cash?
Record transfers and ATM withdrawals in the register the same day they happen, with a reference code instead of a check number. A transfer is money moving between your own accounts, and an ATM withdrawal moves money from the account to your pocket. Both reduce the balance, and neither has a check to look up.
Transfers between your own accounts
A transfer to savings appears twice: as a payment in checking and as a deposit in savings. Reconcile each account on its own statement and make sure both sides are recorded. If one side is missing, a transfer can look like lost money. Match the two by date and amount. A transfer made late on the last day of the month may show on one statement and not the other, which makes it a timing item and not an error.
ATM cash and fees
An ATM withdrawal shows on the statement with a location and sometimes a separate fee. Record the withdrawal for the amount you took out and the fee as its own line. If you use a bank other than your own, the other machine's fee may appear as a separate charge on the statement a day or two later.
Lines with no check number
For any movement without a check number, use a consistent reference such as ATM, XFER or DC. A consistent code gives you something to search for and keeps the register readable. When the statement shows an automatic payment, such as a loan or subscription, add it to the register as a regular line with its own code the first time it appears.
Keep a short list of the recurring ones. Missing an automatic payment is one of the most common reasons a register is off by a round amount.
Checking account reconciliation when no register was kept
When no register was kept, rebuild it from the bank statements, starting with the oldest one you have. The statement becomes the register: every line is entered as it appears, and then you add what the statements cannot show, such as checks written but not yet cashed.
The rebuild
- Collect the statements. Get every month from a month where you know the balance was right. Ask the bank for any that are missing.
- Open the register at the first opening balance. Use the statement's opening balance as the starting figure.
- Enter every statement line in date order, using the printed description and amount.
- Add the unknowns. Checks you wrote that have not cleared by the latest statement date are known only from your checkbook stubs, receipts or memory. List them as outstanding.
- Add the payees. For each check, look at the check image, if your bank provides one, to see who was paid, and write the payee in the register.
- Reconcile the final month using the equation above.
What the rebuilt register cannot tell you
A register rebuilt from statements will always agree with the bank, since it is made of the bank's own lines. That agreement proves nothing. The test of a rebuilt register is whether it explains the transactions: do you recognise every payee, and is any check number missing from the sequence? A gap in the numbering may mean a voided check, or one that was written and not yet presented.
Use the rebuilt register to start keeping a real one. From the next month on, record every item as it happens and reconcile at each month-end.
Should a checking account be reconciled in a check register or in Excel?
A paper or app-based check register suits a personal account or a business with a few dozen transactions a month, while an Excel register suits an account with hundreds of lines. The choice comes down to volume, how many people write checks, and whether someone else must review your work.
A paper register
Paper is quick, cheap and hard to damage. It works when one person handles the account and the monthly activity is small. Its weakness is arithmetic. Every balance depends on the line above it, and one error spreads down the page.
An Excel check register with reconciliation
A spreadsheet register adds a running-balance formula, a cleared column you can filter, and room for a sign-off. It also lets you add a formula that sums the uncleared payments and tells you at once whether the adjusted balances agree. The cost is discipline: pasting over a formula, or editing a cleared line, can leave the sheet looking right and being wrong. To have formulas find the matches for you, read which Excel formula matches bank transactions best.
When to look for something else
If you reconcile checking accounts for clients, the register stops being the bottleneck and the volume of statements does. At that point look at what a tool must do before you adopt it. The guide to check reconciliation software covers what to look for in the check-matching step.
PreciseBankFlow proves that each statement foots, matches its lines to your register or ledger, and reports the checks and deposits that did not clear, together with any gap in a check sequence. It is opening to CPA and audit firms in small groups, and you can request a spot from the Get started page. Whatever method you use, set a regular date for it; the schedule is described in monthly bank reconciliation deadlines.