How does the timing of banking affect month-end reconciliation?

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Answer

Receipts banked at or after the last business day of the month are recorded in the cash book but may not reach the statement until the next month, creating outstanding lodgements. Similarly, cheques written near month-end remain unpresented. These timing items are the main reconciling differences and clear early next month.

Real-world example Takings banked on the 31st appear in the cash book but only clear the bank in early next month.

Common follow-ups: Why do month-end items dominate the reconciliation? | When do they clear?

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