Is it absolutely necessary to reconcile our books to the last penny? It seems a lot of effort for not much point.
There are some areas where you can disregard small discrepancies, but when it comes to reconciling the bank account to the general ledger you need to be “bang on all the time,” says David Brown of the Edge Retail Academy. It primarily has to do with security: A common embezzlement technique involves skimming small, seemingly random amounts of cash from revenue. Over many years, these mysterious discrepancies can add up to tens of thousands of dollars. Keeping everything in order shouldn’t be that hard if you’ve computerized your accounting and your checking account reconciliation, Brown says.