Glossary
Bank Reconciliation
Matching an account's ledger balance to its bank statement, explaining every difference between the two.
Bank reconciliation is the control that proves the books reflect reality. Outstanding cheques, deposits in transit, and fees explain legitimate differences; anything left over is an error or worse.
For a premium trust account it is not just good practice but a compliance requirement in most states. The reconciliation is the evidence that the account holds what it should, and examiners ask for it directly.
See also
- Trust Account — A segregated bank account where an insurance agency holds premiums collected from clients on behalf of carriers. Strictl…
- General Ledger — The central accounting record holding every financial transaction of a business, organised by account.
- Fiduciary Accounting — Accounting performed by an entity holding funds on behalf of another party. Insurance agencies act as fiduciaries when c…