Reconcile your cash account with the bank statement in minutes. Paste or open both lists of transactions, and the tool matches them by check number and amount, lists outstanding checks, deposits in transit and bank-only items, and shows whether the adjusted bank and book balances agree.
Last updated:
One transaction per line. Money in is positive, money out is negative (or use Debit/Credit columns with a header row). Check numbers in the description, like “Check #1042”, are matched first.
Bank side
Book side
Adjusting entries to record in your books
Unmatched items
In books, not on bank statement
On bank statement, not in books
Matched items
Book
Bank
Amount
How
Unmatch
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How to use the Bank Reconciliation Tool
Enter the statement date and both ending balances: the balance on the bank statement and the cash balance in your books on the same date.
Paste your book transactions (cash ledger or check register) for the period, plus any items still uncleared from earlier months. One line per item: date, description, amount, with money out as negative.
Paste the bank statement transactions in the same way, or use Open CSV on either side.
Review the matches. Select one unmatched book item and one unmatched bank item and press Match selected to pair anything the tool missed.
Read the result. When the adjusted balances agree the account is reconciled; record the suggested adjusting entries in your books, then print or download the report.
The bank reconciliation formula
A reconciliation adjusts both balances to the true cash balance on the statement date:
Adjusted bank balance = bank statement balance + deposits in transit − outstanding checks and withdrawals
Adjusted book balance = book balance + bank credits not yet recorded − bank charges not yet recorded ± corrections of book errors
The account is reconciled when adjusted bank balance = adjusted book balance.
The example that loads with the tool works like this (September statement, both sides started the month at $5,000.00):
Bank side
Amount
Book side
Amount
Balance per bank
$5,311.22
Balance per books
$6,871.95
+ Deposit in transit (Sep 30)
$1,780.00
+ Interest paid by bank
$3.27
− Outstanding check #1045
−$420.00
− Monthly service fee
−$15.00
− NSF returned check
−$180.00
− Check #1043 recorded as $312.45, cleared for $321.45
−$9.00
Adjusted bank balance
$6,671.22
Adjusted book balance
$6,671.22
Reconciling items at a glance
Item
Where it is adjusted
Journal entry needed?
Deposit in transit (recorded in books, not yet on statement)
Add to bank balance
No, timing only
Outstanding check (written, not yet cashed)
Subtract from bank balance
No, timing only
Bank service fee, overdraft fee
Subtract from book balance
Yes: debit bank fees expense, credit cash
Interest earned
Add to book balance
Yes: debit cash, credit interest income
NSF / returned customer check
Subtract from book balance
Yes: debit accounts receivable, credit cash
Collection by the bank (note, ACH receipt)
Add to book balance
Yes: debit cash, credit the receivable or revenue
Book error (wrong amount recorded)
Add or subtract the difference on the book side
Yes: correcting entry
Bank error
Adjust the bank side
No; ask the bank to correct it
Tips for a quick reconciliation
Start from last month's list. Checks and deposits that were outstanding last month belong in this month's book list until they clear.
Reconcile every month, soon after the statement arrives. Small differences are easy to trace when they are fresh.
Investigate stale checks. A check outstanding for more than a few months may be lost; contact the payee before voiding it.
Use the size of the difference. If it equals one transaction, that item is probably missing; if it is twice an item, the sign is probably wrong; if it divides evenly by 9, look for transposed digits.
Frequently asked questions
What is a bank reconciliation?
It is a check that the cash balance in your accounting records agrees with the bank. The two numbers rarely match on the statement date because of timing (checks not yet cleared, deposits not yet credited) and items only the bank knows about (fees, interest, returned checks). The reconciliation explains every difference so that the adjusted bank balance equals the adjusted book balance.
What is the bank reconciliation formula?
Adjusted bank balance = bank statement balance + deposits in transit − outstanding checks. Adjusted book balance = book balance + bank credits not yet recorded (such as interest) − bank charges not yet recorded (such as fees and NSF checks) ± corrections of book errors. The account is reconciled when the two adjusted balances are equal.
How does the automatic matching work?
First, items whose descriptions contain the same check number are paired. Then the remaining items are paired by exact amount, choosing the bank item with the closest date from 3 days before to the chosen number of days after the book date. Anything left over is unmatched and treated as a timing item or a bank-only item.
Why is there still a difference after matching?
Common causes: an ending balance typed wrongly, an uncleared item from a previous month missing from the book list, a transaction recorded twice, a deposit recorded for the wrong amount, or a sign error (money out entered as positive). Check the unmatched lists first; the difference often equals one item or twice one item.
Which items need a journal entry?
Only the book-side items: bank fees, interest earned, NSF or returned checks, automatic debits or credits you have not recorded, and corrections of your own errors. Deposits in transit and outstanding checks are timing differences and need no entry; they clear on next month's statement.
Is my financial data uploaded?
No. Everything is calculated in your browser and nothing is sent to a server or stored. Close the tab and the data is gone, so download the CSV or print the report to keep a record.
Are all the tools on FreeToolCabin tested for quality and accuracy?
Yes! Every tool on our site undergoes automated Q/A testing in real browser environments to ensure high precision, correct output, and zero errors. If you happen to spot a bug or have a suggestion, please contact us at [email protected] and our team will review it right away.