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Where is EFT Payment made by customer included in a bank reconciliation?

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In a bank reconciliation, EFT payments made by customers would typically be included in the Deposits in Transit section. Here is an explanation of why:

A bank reconciliation is the process of comparing the bank balance according to your records with the bank balance according to the bank statement. The purpose is to identify and resolve any discrepancies between the two balances.

When a customer makes an EFT payment to your business, the funds have technically been transferred from their bank account to your bank account. However, it may take a day or two for that transfer to actually show up on your bank statement.

During that time between when the customer makes the payment and when it appears on your statement, the funds are considered "in transit." You know the payment has been made based on your customer records, but the bank does not yet reflect that increase in your balance.

So to reconcile this, you would include the EFT payment amount in the Deposits in Transit section of your bank reconciliation. This helps explain why your records show a higher balance than what the bank currently shows - because there are deposits that have been made but have not cleared yet.

Once the EFT payment does appear on your bank statement, you would then remove it from the Deposits in Transit section since the bank now reflects that deposit.

Hope this explanation helps! Let me know if you have any other questions.

User Samir Aguiar
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