Following is a transcript of this podcast episode, with audio/video below.
Welcome to the Two-Minute Treasurer’s Tip Podcast. I’m your host, Cyndi Meuchel, and the coowner of MoneyMinder, where our goal is to make your life as a volunteer super easy.
Today I’m answering the following question: Why is it important to reconcile my account? Tina writes in, “The president wants me to reconcile our bank accounts. I don’t know what this means. Can you help me understand how to do this and why I need to take this step?”.
So you may have heard the term “balancing your checkbook”. That’s exactly what a reconciliation is. You’re basically going to compare your bank account with your checkbook register or MoneyMinder to make sure that there aren’t any mistakes. You might be thinking, “Gosh, in this highly technical world can’t I trust my bank and can’t I trust that they’re accurate?”.
Sadly, no. I recently talked to a treasurer, get this, who discovered that a check that they wrote was deposited into the person’s account that they wrote it to via their mobile banking app. You know, where you take a picture of it to deposit it, and then it was also presented physically at the bank. So it cleared twice. I wish I could see your face right now. Not only does reconciling your bank account help identify those errors, it also helps to prevent fraud. So when your board can see that the bank balance agrees with the check register and that everything is accounted
for, you can be sure all is well.
Reconciling is easiest done on a monthly basis. So each month when you get your bank statement or download it from your bank, you’ll basically compare each entry, making sure that what you’ve recorded matches what the bank thinks. We have a great guide on our website that walks you through the reconciliation process. It’s free. If you go to MoneyMinder.com and select ‘Guides’ from the resources drop down menu. Just click on the box that says ‘Reconciliation’ and you’ll get access to that free download. So go check it out!
That’s it for today. Thank you for listening. If you’re a treasurer with a burning question, email me at [email protected], so I can answer it. My name is Cyndi Meuchel and this is your Two-Minute Treasurer’s Tip today.