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QUARTER 2: MELC #16 (Week 1) W: Fabm 2 Learner'S Packet #10

The document provides information about bank reconciliation statements, including: 1. Bank reconciliation statements compare a company's accounting records of its bank balance to the balance stated on the bank statement in order to identify any discrepancies between the two records. 2. Common causes of discrepancies include time differences in recording transactions and errors made in the recording process. 3. The document outlines the importance of bank reconciliation and describes the key elements of a bank reconciliation statement, such as reconciling items.

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Crize Scofield
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77 views2 pages

QUARTER 2: MELC #16 (Week 1) W: Fabm 2 Learner'S Packet #10

The document provides information about bank reconciliation statements, including: 1. Bank reconciliation statements compare a company's accounting records of its bank balance to the balance stated on the bank statement in order to identify any discrepancies between the two records. 2. Common causes of discrepancies include time differences in recording transactions and errors made in the recording process. 3. The document outlines the importance of bank reconciliation and describes the key elements of a bank reconciliation statement, such as reconciling items.

Uploaded by

Crize Scofield
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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QUARTER 2: MELC #16( Week 1)

FABM 2 LEARNER’S PACKET #10

Content Standards
W
The learners demonstrate an understanding of the bank
reconciliation statement, its nature and structure, and
reconciling items and methods of preparation
The learners shall be able to solve exercises and problems involving
the following:
Performance Standards 1. identification of the proper treatment of reconciling items in the
bank reconciliation statement
2. preparation of a bank
reconciliation statement.
Most Essential Learning
Competencies (MELC’S) Content Learner’s Packet

1. describe the nature of a No. of Teaching Dates Learner’s LM Pages


bank reconciliation statement days Material
ABM_FABM12-IId
4
REMINDER: WRITE ANSWERS TO THE ACTIVITY SHEETS on an A4 BOND PAPER.

What is it?
BASIC RECONCILIATION STATEMENT
Nature of a Bank Reconciliation Statement

Cash among others is the most vulnerable and important asset of an entity hence, companies find ways to protect it from
fraud and mishandling. That’s the reason why personnel responsible on accounting and authorizing of bank transactions are
separated to those responsible for preparing and monitoring bank transactions because cash is the most tempting and can easily
be transported, hidden, and has immediate buying power that is acceptable at face value. One way to safeguard this asset is by
reconciling what was on the records with what actually exist.
Bank Reconciliation Statement is a report which compares the bank balance as per company's accounting records with the
balance stated in the bank statement. This report is being prepared due to the difference between the bank balance from the
company’s accounting records with the bank statement balance.
Bank statement is a document issued by the bank to its depositors usually at the end of the month that shows the beginning
balance, additions, deductions, and the account balance at the end of the month. (MELC#15-Contents of a Bank Statement)
Accounting records are the account balances reflected on the financial statements maintained by each entity.
Bank Reconciliation is the process of coming to agreement bank balance with the book balance of cash account.
Most of the common causes of discrepancies in a Bank Reconciliation Statement are time differences in recording and
processing of the transactions and errors in the recording process.
Importance of Bank Reconciliation
1. It acts as a control mechanism on the flow of cash.
2. Monthly preparation assists in the regular monitoring of cash flows of a business.
3. It aids to uncover irregularities such as unauthorized bank withdrawals.
4. Helps in finding and correcting differences on both of the party’s records.
5. Provides assurance to companies that their records are accurate if the bank balance in the accounting records were
confirmed to be correct with the balance per bank record.

Bank Reconciliation Statement are presented in three (3) formats, the Adjusted Method, Book to Bank Method, and Bank to
Book Method. This will be discussed in the succeeding lessons.

1
E What is more?

ACTIVITY 1: Identification (10 points)


Read the following statements. Identify what is being described in the statement and write your answer on the space provided before
the number.
_______ 1. The account holder who makes the check is the ______.
_______ 2. Document issued to the account holder showing all the deposits made,
checks paid and the balance of the account for a certain period of time.
_______ 3. A control procedure by the account holder in handling cash where bank statement
records are compared with the company’s accounting records specifically the Cash
account balance reflected in the General Ledger.
_______ 4. The most tempting and vulnerable asset of the company.
_______ 5. The money held in the bank that can be withdrawn through the issuance of check.
________ 6. A report showing comparison between the bank’s and the company’s records that
acts as a control mechanism of the entity to monitor its cash account.
________ 7. One of the most common causes of discrepancy in the Bank Reconciliation
Statement that occurred in the recording process.
________ 8. A document that orders the bank to pay money to a specific person or entity from a
person’s account held in the bank.
________ 9. This is the reason why a Bank Reconciliation Statement is prepared due to its
existence between the bank statement balance and the company’s accounting
records.
________ 10. Generally, basic reconciliation of bank balance (cash account) is prepared _____.

A What I have learned?

ACTIVITY 2: THINK and WRITE (20 points)

Think and reflect on the activities that you did, then write your reflections and insights.

Guide questions:
1. While answering the activities, what are your realizations as to the difference between Bank Reconciliation and Bank Reconciliation
Statement ? Why is there a need for bank reconciliation?
2.What areas of the activity do you consider difficult and easy to answer?
3.Explain your most important learnings from the topic and how can you apply the knowledge on the nature of a bank reconciliation
to your life as an ABM student.

DIRECTIONS:
a. Limit your answer to THREE (3) sentences for each question. Answer in complete sentence.
b. Share your own thoughts and reflections honestly.
c. Points will be deducted from answers searched through the internet.

Prepared: Checked: Noted:

MA. AURORA C. ALONZO MARICRIS G. PETELO LIBRADA A. VIDALLON

“Specific instructions are embedded in this packet, hence WHLP is not needed.”

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