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Difference Between Bank Book and Bank Statement
1. Financial Accounting
1
Lecture – 22
Reasons for Difference Between Bank Book and Bank Statement
• Receipts are recorded by us on the date of receipt of
cheque, whereas bank records the transaction at actual time
of receipt.
• Payments are recorded at the time of issuing the cheque,
whereas the bank records the payment at time of actual
payment.
• Bank charges deducted by bank that come to our
knowledge when we receive the bank statement.
• Payments made directly by the bank on our standing
instructions.
• Moneys paid in directly by our dealers or custonmers.
2. Financial Accounting
2
Lecture – 22
Example
Bank Book (Bank Account Number)
Date
20--
Vr.
#
Chq.
No.
Narration /
Particulars
Ledger
Code
Receipt
Amount
Payment
Amount
Balance
Dr/(Cr)
Jul 01 Opening Balance 150,000 150,000
Jul 05 0001 Paid to XYZ 20,000 130,000
Jul 10 Cash Deposit in Bank 5,000 135,000
Jul 15 0002 Paid to ABC 25,000 110,000
Jul 20 0003 Paid to creditors 50,000 60,000
3. Financial Accounting
3
Lecture – 22Tracing Figures From Bank Book to Bank
Statement
Bank Statement Account No. -------
Date
20--
Narration /
Particulars
Withdrawals
Amount
Deposits
Amount
Balance
Jul 01 Opening Balance 150,000 150,000
Jul 05 Chq # 0001 20,000 130,000
Jul 10 Cash Deposit in Bank 5,000 135,000
Jul 15 Chq # 0001 25,000 110,000
Jul 20 Chq # 0001 50,000 60,000
Jul 31 Bank charges 500 59,500
Jul 31 Profit 700 60,200
4. Financial Accounting
4
Lecture – 22
Example
Bank Statement Account No. -------
Date
20--
Narration /
Particulars
Withdrawals
Amount
Deposits
Amount
Balance
Jul 01 Opening Balance 150,000 150,000
Jul 05 Chq # 0001 20,000 130,000
Jul 10 Cash Deposit in Bank 5,000 135,000
Jul 15 Chq # 0001 25,000 110,000
Jul 20 Chq # 0001 50,000 60,000
Jul 31 Bank charges 500 59,500
Jul 31 Profit 700 60,200
NOTE this slide the same as the previous slide with the change of
colours
5. Financial Accounting
5
Lecture – 22
Bank Reconciliation
Rs.
Balance as per bank book 60,000
Add: Profit given by bank 700
Less: Charges by bank (500)
Balance as per bank statement 60,200
6. Financial Accounting
6
Lecture – 22
• A payment of Rs. 10,000 is made on 31 Jul, and it appears
in our bank statement on Aug, 02.
• Now the balance as per our bank book is Rs 50,000, and
our bank statement is still showing Rs. 60,200
7. Financial Accounting
7
Lecture – 22
Example
Bank Book (Bank Account Number)
Date
20--
Vr.
#
Chq.
No.
Narration /
Particulars
Ledger
Code
Receipt
Amount
Payment
Amount
Balance
Dr/(Cr)
Jul 01 Opening Balance 150,000 150,000
Jul 05 0001 Paid to XYZ 20,000 130,000
Jul 10 Cash Deposit in Bank 5,000 135,000
Jul 15 0002 Paid to ABC 25,000 110,000
Jul 20 0003 Paid to creditors 50,000 60,000
Jul 30 0004 Payment 10,000 50,000
NOTE this slide the same as #2 the change of last row
8. Financial Accounting
8
Lecture – 22
Bank Reconciliation
Rs.
Balance as per bank book 50,000
Add: Profit given by bank 700
Less: Charges by bank (500)
Add: Cheque issued but
not presented in bank 10,000
Balance as per bank statement 60,200
9. Financial Accounting
9
Lecture – 22
Presentation in Balance Sheet
Bank book balance is shown in the balance sheet, not the
bank statement balance.
10. Financial Accounting
10
Lecture – 22
• In the same example assume a cheque of Rs. 10,000 is
received on 31 Jul, and it appears in our bank statement on
Aug, 02.
• Now the balance as per our bank book is Rs 70,000, and
our bank statement is still showing Rs. 60,200
11. Financial Accounting
11
Lecture – 22
Example
Bank Book (Bank Account Number)
Date
20--
Vr.
#
Chq.
No.
Narration /
Particulars
Ledger
Code
Receipt
Amount
Payment
Amount
Balance
Dr/(Cr)
Jul 01 Opening Balance 150,000 150,000
Jul 05 0001 Paid to XYZ 20,000 130,000
Jul 10 Cash Deposit in Bank 5,000 135,000
Jul 15 0002 Paid to ABC 25,000 110,000
Jul 20 0003 Paid to creditors 50,000 60,000
Jul 30 Receiupt 10,000 70,000
NOTE this slide the same as #2 the change of last row
12. Financial Accounting
12
Lecture – 22
Bank Reconciliation
Rs.
Balance as per bank book 70,000
Add: Profit given by bank 700
Less: Charges by bank (500)
Less: Cheque received but
not credited in bank (10,000)
Balance as per bank statement 60,200
13. Financial Accounting
13
Lecture – 22
Example
Bank Book (Bank Account Number)
Date
20--
Vr.
#
Chq.
No.
Narration /
Particulars
Ledger
Code
Receipt
Amount
Payment
Amount
Balance
Dr/(Cr)
Dec 01 Opening Balance 174,000 174,000
Dec 07 Received form Anwer 8,800 182,800
Dec 08 57000 Paid to Tariq 34,900 147,900
Dec 15 57001 Paid to Shabbir 3,300 144,600
Dec 22 Received from Javed 7,300 151,900
Dec 28 57002 Paid to Salim 11,500 140,400
Dec 31 Received from Javed 24,900 165,300
Dec 31 Received form Rashid 17,800 183,100
14. Financial Accounting
14
Lecture – 22Tracing Figures From Bank Book to Bank
Statement
Bank Statement Account No. ----
Date
20--
Narration /
Particulars
Withdrawals
Amount
Deposits
Amount
Balance
Dec 01 Balance B/f 174,000 174,000
Dec 07 Deposits 8,800 182,800
Dec 11 Chq # 57000 34,900 147,900
Dec 20 Chq # 57001 3,300 144,600
Dec 22 Deposits 7,300 151,900
Dec 31 Charges 2,200 149,700
15. Financial Accounting
15
Lecture – 22
Example
Bank Book (Bank Account Number)
Date
20--
Vr.
#
Chq.
No.
Narration /
Particulars
Ledger
Code
Receipt
Amount
Payment
Amount
Balance
Dr/(Cr)
Dec 01 Opening Balance 174,000 174,000
Dec 07 Received form Anwer 8,800 182,800
Dec 08 57000 Paid to Tariq 34,900 147,900
Dec 15 57001 Paid to Shabbir 3,300 144,600
Dec 22 Received from Javed 7,300 151,900
Dec 28 57002 Paid to Salim 11,500 140,400
Dec 31 Received from Javed 24,900 165,300
Dec 31 Received form Rashid 17,800 183,100
16. Financial Accounting
16
Lecture – 22Tracing Figures From Bank Book to Bank
Statement
Bank Statement Account No. ----
Date
20--
Narration /
Particulars
Withdrawals
Amount
Deposits
Amount
Balance
Dec 01 Balance B/f 174,000 174,000
Dec 07 Deposits 8,800 182,800
Dec 11 Chq # 57000 34,900 147,900
Dec 20 Chq # 57001 3,300 144,600
Dec 22 Deposits 7,300 151,900
Dec 31 Charges 2,200 149,700
17. Financial Accounting
17
Lecture – 22
Example
Bank Book (Bank Account Number)
Date
20--
Vr.
#
Chq.
No.
Narration /
Particulars
Ledger
Code
Receipt
Amount
Payment
Amount
Balance
Dr/(Cr)
Dec 01 Opening Balance 174,000 174,000
Dec 07 Received form Anwer 8,800 182,800
Dec 08 57000 Paid to Tariq 34,900 147,900
Dec 15 57001 Paid to Shabbir 3,300 144,600
Dec 22 Received from Javed 7,300 151,900
Dec 28 57002 Paid to Salim 11,500 140,400
Dec 31 Received from Javed 24,900 165,300
Dec 31 Received form Rashid 17,800 183,100
Dec 31 Charges 2,200 180,900
18. Financial Accounting
18
Lecture – 22
Bank Reconciliation Statement
Balance as per bank book 180,900
Add: Un-presented Cheques 11,500
Less: Un-credited Cheques (24,900)
(17,800)
Balance as per bank statement 149,700