Practical guide
How to do the condominium bank reconciliation
Bank reconciliation is the systematic comparison between the movements recorded in the condominium's cash journal and those reported in the bank statement. It serves to verify that every recorded income and expense corresponds to a real movement on the account held in the condominium's name, as the transparency logic of Article 1129 of the Italian Civil Code requires. Reconciliation done regularly immediately catches errors, double entries, missing collections and unexpected charges, preventing them from accumulating until they make the report unreliable. This guide explains how to carry it out in an orderly way.
Why reconcile, and how often
Reconciling means being certain that the accounts kept by the manager reflect the reality of the current account. The report under Article 1130-bis of the Italian Civil Code must allow immediate verification of the asset situation and available funds: without reconciliation this verification is not possible.
The ideal frequency is monthly, matching the arrival of the bank statement. A close cadence makes every check quick, because the movements to compare are few, and allows differences to be corrected at once rather than reconstructed at year-end.
The documents to have at hand
To reconcile you need two sources: the updated cash journal for the period and the bank statement for the same period, with the opening and closing balance. It is useful to also have the supporting documents, invoices and receipts, to clarify doubtful items.
The starting point is the balance: you compare the opening balance of the cash journal with that of the bank statement. If the opening already does not match, the error comes from a previous period and must be resolved before proceeding.
- Updated cash journal for the period
- Bank statement with opening and closing balance
- Invoices, receipts and payment orders for doubtful items
The movement-by-movement comparison
You tick off one by one the movements present in both sources: each line of the cash journal must find a match in a line of the bank statement and vice versa. The movements that appear in only one of the two sources are the items to investigate.
Some differences are physiological and temporary: a cheque issued but not yet cashed, a transfer ordered at month-end and booked by the bank the following month. These outstanding items must be noted and picked up in the next reconciliation, when they will close.
Find and correct the differences
When the balances do not match, the typical causes are few and recurring: a movement not recorded in the cash journal, such as a bank fee or an automatic charge, an amount transcribed incorrectly, a double entry, a collection attributed to the wrong account. You isolate the difference and explain it with the corresponding document.
Fees, account maintenance charges and interest are items often forgotten because they do not arise from an invoice: they must be recorded in the cash journal as soon as they appear on the statement. Only when every difference is explained can the reconciliation be considered closed.
- Bank movements not yet recorded, such as fees and charges
- Amounts transcribed incorrectly
- Double entries to eliminate
- Collections or payments attributed to the wrong account
Close the reconciliation and document it
The reconciliation is complete when the balance of the cash journal, adjusted for outstanding items, matches the balance of the bank statement. At that point it is best to keep the reconciliation statement together with the bank statement, so as to have a verifiable trail for the report and any owner requests.
Management software such as AmministraPro can import the account movements and place them alongside the cash journal, flagging the unreconciled items and reducing manual work. You can see the tools on the /funzioni page and the plans on the /prezzi page.
Frequently asked questions
How often should bank reconciliation be done?
The ideal cadence is monthly, matching the arrival of the bank statement. Reconciling often makes every check quick, because the movements to compare are few, and lets differences be corrected at once instead of having to reconstruct them laboriously at year-end.
What are outstanding items in reconciliation?
They are movements recorded in only one of the two sources for timing reasons, such as a cheque issued but not yet cashed or a transfer ordered at month-end and booked by the bank the following month. They must be noted and closed in the next reconciliation.
Why does the cash journal balance not match the bank statement?
Typical causes are bank movements not recorded such as fees and automatic charges, amounts transcribed incorrectly, double entries or collections attributed to the wrong account. You isolate the difference and explain it with the corresponding document, then correct the cash journal.
Is bank reconciliation mandatory?
There is no rule imposing it by this name, but it is essential to comply with the transparency required by Articles 1129 and 1130-bis of the Italian Civil Code: without reconciliation you cannot guarantee that the report reflects the real situation of the condominium's current account.
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