What Does it Mean to “Reconcile Revenue”?

By Lauren CrumEmail Lauren

As a business owner, you have a lot to juggle. And it’s likely you are constantly keeping an eye on your bank account to see how much money you have available. But how do you know if you’ve received all the funds from each day’s sales? Did the merchant processor transfer the payments that were due for that day? Were cash deposits made by your manager on time?

The easiest way to determine if you received what was expected is to enter each day’s revenue into your bookkeeping software. You should group the transactions into categories (cash received, credit card payments, and gift card sales/redemptions), so your records are organized and easy to make sense of. Then each month (or even better, each week), you should compare your expected receipts for each category to what was actually deposited in your bank account. If the amount you expected is not received within a reasonable period, you should research the difference.

At BKE, we reconcile your revenue for you. For one of our clients, BKE identified a situation where thousands of dollars were missing because their merchant processor had made an error and not transferred the funds for several days of activity.  

We identified another situation where a business’s general manager was not making cash deposits until days after the cash transactions were recorded. It turns out, he was loaning himself the money, then repaying it with future deposits. BKE found these inconsistencies because we were recording the expected receipts and comparing them to the amounts received by the bank on a timely basis.    

Reconciling revenue is a time-consuming process but really is necessary to make sure you are receiving all the funds due to your business. If you would like to learn more about how BKE can help with your bookkeeping, contact us today.