Bank statements are reliably accurate financial records. By checking your books against them you can:
1. Find and fix errors: You’ll spot your bookkeeping mistakes and clean them up.
2. Catch wrongful payments and fraud: Reviewing expenses is a good way to spot incorrect payments or suspicious activity.
3. See how the business is doing (rather than guess): A regularly verified set of numbers keeps you in tune with financial performance.
4. Get tax breaks: You can classify tax-deductible expenses while doing your bank rec.
5. Be prepared for filing taxes: You need a fully reconciled record of business income and expenditure to do tax returns.