4.2 - Bank Reconciliation

Question 1

EHIO

Advantages

Answer 1

• Errors from the cash book or bank statement can be accounted for
• Helps prevent fraud as it is an independent record
• Identification of dishonoured cheques can help with repayment from customers
• Out-of-date cheques can be identified and cancelled in the cash book

Question 2

TW

Disadvantages

Answer 2

• Time consuming
• Won’t show if receipts or payments have been ommitted from the cash book