What is Bank Reconciliation Statement (BRS)?
A statement showing all the items of difference between the bank column of the Cash Book and the bank balance depicted in the Pass Book on a particular date and for a particular period of time is called Bank Reconciliation Statement. It is a statement prepared on a particular date to reconcile the bank balance of the Cash Book with the balance as per the Pass Book or vice-a-versa.
According to Carter ‘Bank Reconciliation Statement is such type of a statement which is prepared to compare the balance shown by a bank statement with the balance shown by Cash Book’
A lot of transactions happen in day to day life of a business. The majority of transactions involve either receiving or paying money. Businesses often choose to deal with all the transactions involving money through their bank account instead of receiving or paying money directly in cash. All businesses have their bank accounts in the form of Fixed Deposit Accounts, Savings Accounts, or Current Accounts. A Current Account is most preferable for businesses because there is a greater limit for holding balance and doing transactions in a day as compared to Savings Account.