Trust Reporting

Why don't the reconciled & cashbook balance amounts match on the Trust Reconciliation Report?

A common question of the trust reconciliation report is why there is a different number in the reconciled balance and the cashbook balance.

Before explaining why the reconciled & cashbook balances are different, it is first important to explain that these balances are not required to match. Whilst yes, in some cases it could mean there is an issue, however in the vast majority of cases it simply means there are transactions that were entered late or there was a reversal required during the month.

The way the trust reconciliation report work is that it will first look at all of the transactions entered during the month, calculate those which then gives you the reconciled balance. After that, the report will then add withdrawal adjustments and deduct deposit adjustments which then provides you the cashbook balance. Put simply, this means that if an entry has been entered in late (e.g. entered in August for the month of July) it is calculated in the cashbook balance. This is because the reconciled balance will only calculate those transactions actually entered during the month of July for example. 

To give you a visual example, you can see in the report below that the reconciled amount is $11,522.14 - this would have included any transactions that were entered into SILQ during the month of July.

You can then see that there were three entries entered in late and have therefore been adjusted, showing as adjustment withdrawals and deposits being:

Adjustment withdrawal $100 
Adjustment Deposit $ 300 
Therefore, the Cashbook balance takes the adjustments into account and the calculation then becomes $11,322.14.

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Please note, the trust regulations require any entry which took place at a date prior to the date of entry to show both the date of entry (Posting Date) and the date it took place the (Transaction Date). Thus users of the cashbooks and ledgers will be aware of both dates and understand the relevance of this. 
For more information on transaction dating please see the below article