What it means
Your books and the bank record the same money at different times. Cheques you issued may not have been presented yet; the bank may have charged fees or credited interest you have not booked. Reconciling, usually monthly, finds these timing differences and any real errors or frauds.
Example
Kaveri Agencies on 31 Oct 2026:
| Item | Amount |
|---|---|
| Balance as per books | ₹2,45,000 |
| Add: cheque issued, not yet presented | ₹30,000 |
| Less: bank charges not yet booked | ₹590 |
| Less: customer UPI receipt booked twice | ₹12,000 |
| Balance as per bank statement | ₹2,62,410 |
The bank charges and the double entry are fixed in the books; the cheque simply clears in November.
Common mistakes
- Reconciling only the closing balance, not entry by entry.
- Letting unmatched items pile up for months, so nobody remembers what they were.
- Booking bank charges and interest only at year end.
In MyRecords
You import the bank statement as CSV or Excel and enter its closing balance. Auto-match marks the lines with a clear match; for the rest, MyRecords suggests payments, journal entries and invoices, and you tick one or create the missing entry from the line. The Difference figure shows what is left. Automatic bank feeds are not built yet; they are on the roadmap.