What is the Purpose of Bank Statement?
A business bank statement can have many purposes within your business. There isn’t a single purpose of a bank statement.
You can use a business bank statement to keep track of uncashed checks. So that you can see if checks you wrote have been cashed or if you still need funds to cover them. Threrefore you might do this by comparing your bank statement to your check register.
You can use your bank statements as supporting documents for business tax forms. While you can reference your statements to be sure you are reporting your taxes correctly. If you are audited, you can use the bank statements as proof that your tax returns are accurate.
When you apply for a business loan, you might have to show your bank statements to the lender. The lender will review the statements to help determine if you are a good fit for a loan.
When you go over your bank statements, some spending habits might jump out. Because you might realize you are spending a lot of money at certain places. Or you might discover an overlooked source of steady income. So creating a business budget is easier when you estimate your future transactions based on your past transactions.
Errors and unauthorized transactions
By reviewing your business bank statements, you can find errors and unauthorized transactions. These might be reporting mistakes, or someone might have stolen your credit card. By regularly looking for discrepancies, you can report them faster and hopefully get your money back.
Bank statement reconciliation
You can use your bank statement to make sure your accounting books are accurate. This has called reconciling bank accounts. You compare the entries between the two and look for inconsistencies.
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