Bank Reconciliations just sound intimidating, don’t they? Can we trust a word that takes 6 syllables to get its point across? For our purposes here in the Jewel Wiki, we will mostly just call them “Bank Recs.”
Bank fraud increased 25% overall just in 2024, and yes, it happens to Adventist church bank accounts too. Fortunately, the bank rec is one of your most effective tools against bank fraud. Our goal is to demystify and simplify the bank rec for you, so you don’t dread it or put it off, or even worse, skip it altogether.
"Reconciling the bank statement" is what we call it when we compare the bank's records of checks and deposits with Jewel's checks and deposits for the same period. The bank statement contains the record of what actually happened in a certain month - the deposits that actually made it to the bank, and real payments that were really made.
Why do builders use a tape measure and a square? Why do writers use a dictionary or a spell-checker? Why do cooks use measuring cups? We need a standard. Something that is authoritative that we can compare to. For treasurers, the bank statement is that standard.
You go through the month, entering offerings into Jewel and paying bills and cranking out reports for the board. But let’s say you forget to enter a deposit in Jewel, maybe an AdventistGiving deposit. How/when will you catch that mistake? You might not, if you don’t reconcile. Or what if you write a check but forget to enter it in Jewel. Or accidentally enter the same payment twice. When will you find it out? When you reconcile.
Your monthly Bank Statement is the document that tells you what deposits actually made it to the bank, what bills were actually paid and how much you actually have left. And as we compare Jewel with the statement at the end of the month, “reconciling” Jewel to the statement, we have a chance to fix any missed checks, duplicate deposits or entry errors, so that Jewel will also tell us what actually happened.
You could record a $1,000,000 donation in Jewel and it would show up on your reports and your board would throw a party. But did it actually happen? If it does not show up on the bank statement, no. And we need Jewel to reflect what actually happened. Every check, every deposit. If your statement and the Jewel reports are not in synch, and if the board is not presented with proof of that fact every month, they don’t know if fraud or even embezzlement is happening. You, as treasurer, can give them that proof at every board meeting.
If you miss reconciling one month, your numbers in Jewel might be ok. But if you go 3 months, 6 months or even more without reconciling, I can guarantee you that the reports you are taking to your board are not real numbers. And your board is running your church with blindfolds on. You could, truthfully, write in red at the top of each report “The following reports are fictional and should not be used by the church board to make real life financial decisions!”
Reconciliations are the backbone of internal controls for church finance. They are standard business practice. They are just good financial management. A bank account that is not being reconciled monthly, at the end of each month, is a red flag to auditors and should be a red flag to all church boards.
Jewel provides a reconcile process that involves locating entries on the bank statement and checking off the matching entry in Jewel. If the dates, check numbers and amounts that have been entered into Jewel are clean and accurate, reconciling can be quick and easy. If the Jewel entries contain errors and typos, and items are missing or duplicated, reconciling will be difficult and lengthy.
The ideal is to reconcile before closing the month and printing the reports for the board. Timing can be an issue, since closing should happen on or before the 10th of the next month, and some banks don't mail statements in time for you to have them before you close. Setting up online access to the church bank account is a great way to resolve this problem. If you do not want to do that, closing first then reconciling as soon as the statement comes is better than waiting until weeks later.
The Bank Reconciliation section of this wiki will teach you how to easily (yes, easily!) and successfully reconcile all of your church’s bank accounts. Checking, savings, debit, revolving fund, CDs. Peace of mind for you, and you will be giving your church board peace of mind every month as well.
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The original version of this page was provided to Jewel by the Georgia-Cumberland Conference Audit Team. Created by Linda McCabe.