Will Reconciliation Correct And Detect All Errors?
There are several common errors that account reconciliation won’t catch. We’ll briefly describe these errors here, because if you know about them-and most importantly know their effect-you are less likely to make them. You also increase the chances that you’ll detect and correct the errors. The New Forgotten Transaction The first kind of error that reconciliation won’t catch is one in which you forget to record a transaction in Money and the transaction hasn’t yet cleared the bank. If you forget to record a check and the check is still outstanding at the end of the statement month, for example, the check doesn’t appear in your register and it doesn’t get listed on your bank statement. In this case, your Money account register actually overstates your account balance by the amount of the check you forgot. You’re more likely in this situation to overdraw your account, of course, because you think you have more money than you actually do. A deposit error can occur in roughly the same way,
