If the accounting staff needs to know the current balance outstanding on a loan, savings, or checking account, the most common way to find out is to call the company’s bank representative. This is a slow and sometimes inaccurate approach, since the representative may not be available or will misread the information appearing on the screen. An easier approach is to provide bank customers with direct access to their account information through a Web site. This access is free, requires no special software besides an Internet browser, and can be accessed at once, if the user is connected to a direct-access Internet connection, such as a DSL, cable, or T1 phone line.
The better Web sites are also heavily engineered to be easy to read, with online, automated help text to walk the user through the screens. The more advanced sites allow users to download check images, initiate wire transfers, and move funds between accounts. This is becoming such a powerful tool that users should consider switching their bank accounts to those financial institutions offering this service.
Online Bank Reconciliation
When conducting on-line bank reconciliations, it is best to do so on a daily basis. There are three reasons for using a daily reconciliation. First, it improves one’s knowledge of the current cash position. Second, there is little reconciliation work remaining at month end, which contributes to a faster close. Finally, a daily review will uncover control problems more quickly, possibly leading to reduced fraud.
There are a few procedural issues to be aware of when conducting daily bank reconciliations:
. High Cash Transaction Volume
If there are many daily transactions to cross-check, it is easy to miss one. If so, either reconcile in clusters by type of transaction (deposits first, checks second, etc.) or print the bank’s daily transactions and manually cross off each one as it is reconciled.
. Missed Days In Reconciling Bank Account
It is easy to forget to reconcile every day. To avoid this problem, list it in the daily work log to be the first item handled each day, so it is completed before other issues arise and force it into the background. Also, always verify that the accounting records were reconciled for the previous day when conducting the current day’s reconciliation.
. Record Electronic Transactions on Weekends
If batches of check deposits and incoming ACH payments are recorded as received in the company’s accounting records on the same day, this presents a problem for the person completing a daily bank reconciliation. An ACH payment will clear the bank at once, whereas a check payment may not clear for several days, making it difficult to check off all receipts for that day as being received. To avoid this problem, record electronic receipts on weekend dates, when there are no check receipts to muddy the reconciliation process.
Internet Banking Best Practice Tips
Online banking certainly provides great convenience, yes it does, AS LONG AS YOU KNOW “HOW TO PROTECT YOUR BANK ACCOUNT“ AGAINST THIEFS. Fail in securing your bank account could lead company to loss in big cash in the checking account. Here is a set of tips that may help you to prevent scammers, fisher gain access into your bank account:
- Never be tempted to do your online banking in the library or the local Internet cafe. You have no way of knowing who has access to that information or how they’ll treat it. There may be keystroke loggers on the computer, which make it very easy for a thief to steal your private information (Note: A keystroke logger is a hardware device or software program that monitors each keystroke a user types on the keyboard. This information can then easily be transmitted to the scammer, who then can have access to user names, passwords, and other confidential information). To cover this issue, don’t ever use public computers for transactions that involve your bank account or any identity or information that related with your bank account.
- Don’t ever try to access your account through an emailed link. No matter how much that email looks like it came from your bank. These kinds of emails that request you to log into your bank account are most likely “fishing” scams. Also, don’t give out any company information if someone who claims to be from your bank contacts you, by email or by phone. The best way to be reasonably sure that you really are dealing with your financial institute is to always initiate the contact FROM YOURSELF (not from the other party). If you really know any call is come from your bank, always re-check with the authorized account manager in your banker.
- When you visit the bank’s site, make sure that the page where you type your info always starts with https: The “s” means that the URL is on a secure server. Never type confidential information or passwords into a non-secure page.
- Change password or PIN regularly, and don’t tell anyone what it is, or allow anyone else to use it. Even people you trust should not have access to your online banking password. Change your password at least once a quarter. If you suspect there may be a problem, immediately change your password and call your bank.
- Log in to your account on a regular basis, even if you don’t have any transactions to do. Simply take a look. It only takes a moment to review your information so that you know what’s going on and to make sure nothing is wrong. If you do discover a problem or a discrepancy, contact your bank immediately.
- If you are doing online banking, your computer should have the following software installed: (a).A firewall. Firewalls ‘block the door’ to your computer so ‘hackers’ can’t access the information on your hard drive. (b) Spy-ware blockers. Spy-ware is any program that secretly downloads onto your system when you access the Internet, often through pop-up ads or attachments. (c) The software gathers information about you from your computer and sends it to ‘third parties’ who could be scammers who will steal your money. (d) Anti-Virus software. Scammers sometimes send virus ‘trojan horse’ programs by email, and anti-virus software installed on your system can stop these. To learn more about anti-virus software, click here. To cover this issue, install a good firewall, spy-ware blocking software, and updated anti-virus software program.
- Report all problems and suspicious activity on your bank account immediately, right as soon as you notice it.