AccountancyCBSE Class 11 · Bank Reconciliation Statement

Bank Reconciliation Statement Class 11: Timing Differences and BRS from the Cash Book Balance

Updated 17 October 2026 · Fact-checked

A bank reconciliation statement (BRS) explains the difference between the balance in the firm's cash book (bank column) and the balance in the bank's pass book (bank statement) on the same date. Starting from a favourable cash book balance, add cheques issued but not yet presented and items credited by the bank but not in the cash book; deduct cheques deposited but not yet collected and items debited by the bank but not in the cash book.

Starting from the cash book balance, add the two green items and deduct the two red items to reach the pass book balance.

Illustration drawn for QuestionBuddy.

Understand Bank Reconciliation Statement: Timing Differences and BRS from the Cash Book Balance

Why the balances differ. The firm records its transactions in the cash book; the bank records the same account from its side in the pass book. A transaction is recorded in one book first and in the other later, or an error is made. The BRS reconciles them. It is a statement, not an account, and it is prepared by the firm.

Timing differences (recorded first in the cash book).

*Cheque issued but not yet presented*: firm credited the bank column; the bank has not yet paid. Cash book balance is lower than the pass book balance.
*Cheque deposited but not yet collected/credited*: firm debited the bank column; the bank has not credited. Cash book is higher.

Items recorded first by the bank (the firm learns from the pass book).

Credited by the bank, not in the cash book: interest on deposits, dividends or bills collected directly, direct deposit by a customer.
Debited by the bank, not in the cash book: bank charges, interest on overdraft, insurance or loan instalments paid under standing instruction, dishonoured cheques.

Rule (starting from a favourable cash book balance).

Item	Effect
Cheques issued not presented	Add
Cheques deposited not collected	Deduct
Credited by bank, not in cash book	Add
Debited by bank, not in cash book	Deduct

When the starting point is the pass book balance, the signs reverse.

Remember. After preparing the BRS, the firm should pass entries in the cash book for items recorded first by the bank. Cheques issued but not presented and cheques deposited but not collected need no entry because the cash book already has them.

Bank Reconciliation Statement: Timing Differences and BRS from the Cash Book Balance: key facts

From cash book balance: Add cheques issued not presented
Add credited by bank, not in cash book
Deduct cheques deposited not collected
Deduct debited by bank, not in cash book; Result is the pass book balance.
From pass book balance: Signs reverse
Deduct: cheques issued not presented
Add: cheques deposited not collected; Result is the cash book balance.
Entries needed: Items first recorded by the bank need cash book entries | Timing items need none; Update the cash book.

Add	cheques issued not presented
Add	credited by bank, not in cash book
Deduct	cheques deposited not collected
Deduct	debited by bank, not in cash book

How to answer Bank Reconciliation Statement: Timing Differences and BRS from the Cash Book Balance questions

Decide the starting point, then add or subtract by asking one question for each item: which book is behind?

1Write the starting balance and say whether it is favourable (debit) or an overdraft.
2For each item ask: was it recorded in the cash book first, or by the bank first?
3Apply the table of signs; reverse them if the start is the pass book.
4Total to get the other balance.
5Check by working back from the result with signs reversed.

Bank Reconciliation Statement: Timing Differences and BRS from the Cash Book Balance in real life

The idea, met in an everyday situation. Answer the question in your own words, then compare with the model answer. The one-line hook is what to remember.

A cheque in the post

Suppose a shop issues a cheque for ₹6,200 to a supplier on 30 December, and the supplier presents it on 3 January.

How does the 31 December BRS treat it?

Try it first, then show the solutionSolution

The shop credited the bank column on 30 December, so the cash book balance is already ₹6,200 lower than the pass book balance, because the bank has not yet paid the cheque.
The bank still shows the money, so the pass book balance is higher.

Answer: Add ₹6,200 to the cash book balance to reach the pass book balance.

Memory hook: Not yet presented, so the bank still has the money.

Tricks to remember Bank Reconciliation Statement: Timing Differences and BRS from the Cash Book Balance

Short memory aids. Say each one aloud once, then use it on a question the same day.

Issued adds, deposited deducts
Cheques issued but not presented are added; cheques deposited but not collected are deducted (from the cash book balance).
Use it when: Timing items.
Bank adds, bank takes
Bank credits are added; bank debits are deducted (from the cash book balance).
Use it when: Bank-first items.

Bank Reconciliation Statement: Timing Differences and BRS from the Cash Book Balance: solved examples

Ordered from board level to HOTS. Try each one before you open the solution.

Example 1: Which sign? · 1 mark · MCQBoard level

When preparing the BRS from a favourable cash book balance, a cheque issued but not yet presented is:
(a) added
(b) deducted
(c) ignored
(d) first entered in the cash book

Try it first, then show the solutionSolution

The bank has not yet paid, so the pass book balance is higher.

Answer: (a) added

Example 2: Reasons for differences · 3 marks · Short answerBoard level

State the effect on the BRS (add or deduct from the cash book balance) of: (i) bank charges debited by the bank; (ii) interest credited by the bank; (iii) cheque deposited but not collected. (3 marks)

Try it first, then show the solutionSolution

(i) Deduct: the bank has reduced the balance.
(ii) Add: the bank has increased the balance.
(iii) Deduct: the firm has added it, the bank has not.

Answer: (i) deduct (ii) add (iii) deduct

Example 3: BRS from the cash book · 5 marks · Long answerHarder board level

The cash book showed a bank balance of ₹48,000 on 31 December. Cheques issued but not presented: ₹6,200. Cheques deposited but not collected: ₹9,500. Interest credited by the bank: ₹1,200. Bank charges debited: ₹350. A customer deposited ₹4,000 directly in the bank. An insurance premium of ₹2,500 was paid by the bank under standing instruction. Prepare the BRS. (5 marks)

Try it first, then show the solutionSolution

Balance as per cash book 48,000.
Add: cheques issued not presented 6,200; interest credited 1,200; direct deposit 4,000; total additions 11,400. Subtotal 59,400.
Deduct: cheques deposited not collected 9,500; bank charges 350; insurance premium 2,500; total deductions 12,350.
Balance as per pass book = 59,400 − 12,350 = ₹47,050.

Answer: Balance as per pass book ₹47,050.

Example 4: BRS from the pass book · 5 marks · Short answerHarder board level

The pass book showed a credit balance of ₹62,000. Cheques issued but not presented ₹8,000; cheques deposited but not collected ₹5,000; dividend of ₹3,000 collected by the bank directly; bank charges ₹600 not in the cash book; a customer's cheque of ₹2,000 returned dishonoured, debited by the bank. Find the cash book balance. (5 marks)

Try it first, then show the solutionSolution

Start with the pass book balance 62,000.
Cheques issued not presented: the cash book is lower, so deduct 8,000. Cheques deposited not collected: cash book higher, add 5,000.
Dividend credited by the bank not in the cash book: cash book lower, deduct 3,000. Bank charges: cash book higher, add 600. Dishonoured cheque: cash book still shows the money, add 2,000.
Cash book balance = 62,000 − 8,000 + 5,000 − 3,000 + 600 + 2,000 = ₹58,600.
Check forward from 58,600: 58,600 + 8,000 − 5,000 + 3,000 − 600 − 2,000 = 62,000.

Answer: Cash book balance ₹58,600.

Example 5: An error and two timing items · 5 marks · Short answerHOTS / competency

The cash book balance is ₹40,000. A cheque issued for ₹3,600 was entered in the cash book as ₹6,300 and was paid by the bank at ₹3,600. Other cheques issued but not presented amount to ₹5,000, and cheques deposited but not collected to ₹8,000. Prepare the BRS and state the effect of the error on the cash book. (5 marks)

Try it first, then show the solutionSolution

Error: the cash book credit is 2,700 too much, so the cash book balance is understated by 2,700; add 2,700.
Balance as per cash book 40,000; add cheques issued not presented 5,000; add error 2,700; deduct cheques deposited not collected 8,000.
Balance as per pass book = 40,000 + 5,000 + 2,700 − 8,000 = ₹39,700.
The error should be corrected in the cash book (Bank Dr 2,700).

Answer: Pass book balance ₹39,700; correct the cash book by debiting bank ₹2,700.

Where students lose marks in Bank Reconciliation Statement: Timing Differences and BRS from the Cash Book Balance

The slips examiners see most often, and what to write instead.

Mistake: Deducting cheques issued but not presented
Reversing the sign.
Wrong working
48,000 − 6,200.
Right working
48,000 + 6,200.
Do this: The bank still holds the money.
Usually costs: 1 mark
Mistake: Adding an item on the wrong side because the start was the pass book
Using the cash book table with a pass book start.
Wrong working
Pass book 62,000 + 8,000.
Right working
Pass book 62,000 − 8,000.
Do this: Reverse every sign when the start changes.
Usually costs: 1 to 2 marks
Mistake: Making a cash book entry for a timing item
Thinking everything needs an entry.
Wrong working
Entry for cheques not presented.
Right working
No entry: the cash book already has it.
Do this: Entries only for items the bank recorded first.
Usually costs: 1 mark

Exam tips

Write the heading: "Bank Reconciliation Statement as on ..." and state the starting balance.
Give each item a reason in a short bracket (not presented, not collected, credited by bank).
Check your answer by working back with reversed signs.
Do not call the BRS an account; it has no debit and credit sides.

Practice questions on Bank Reconciliation Statement: Timing Differences and BRS from the Cash Book Balance

Write each answer on paper first. Open the hint only if you are stuck, and the answer only when you have finished.

Q1 · 1 mark · MCQBoard level
A bank reconciliation statement is:
(a) a ledger account
(b) a statement showing reasons for difference between cash book and pass book balances
(c) a book of original entry
(d) a part of the balance sheet
Hint
Statement, not account.
Answer
(b) a statement showing reasons for difference between cash book and pass book balances
Q2 · 4 marks · Short answerHarder board level
The pass book shows a balance of ₹30,000. Cheques issued but not presented ₹4,000; cheques deposited but not collected ₹6,500; interest credited by the bank ₹900; bank charges ₹250. Find the cash book balance. (4 marks)
Hint
Start from the pass book, reverse signs.
Answer
Cash book = 30,000 − 4,000 + 6,500 − 900 + 250 = ₹31,850. Check forward: 31,850 + 4,000 − 6,500 + 900 − 250 = 30,000.
Q3 · 4 marks · Short answerHarder board level
Cash book balance ₹52,000. Cheques deposited ₹7,000 but not yet collected; cheques issued ₹4,500 not yet presented; bank collected a bill of ₹10,000 directly with ₹200 collection charge. Find the pass book balance. (4 marks)
Hint
Bill collected is net of charges.
Answer
Pass book = 52,000 + 4,500 − 7,000 + 10,000 − 200 = ₹59,300.
Q4 · 1 mark · Assertion-reasonHarder board level
Assertion (A): A direct deposit made by a customer into the firm's bank account is added when the BRS starts from the cash book balance.
Reason (R): The bank has credited the amount but the cash book has not yet recorded it.
(a) Both A and R are true, and R is the correct explanation of A.
(b) Both A and R are true, but R is not the correct explanation of A.
(c) A is true, but R is false.
(d) A is false, but R is true.
Hint
Which book is behind?
Answer
(a) Both A and R are true, and R is the correct explanation of A.
Q5 · 4 marks · Short answerHOTS / competency
The cash book and the pass book both show ₹25,000. On investigation, cheques issued but not presented are ₹3,000 and cheques deposited but not collected are ₹3,000. The accountant says no BRS is needed. Show whether he is right and explain. (4 marks)
Hint
Equal and opposite.
Answer
He is wrong to skip it. BRS: cash book balance 25,000 + 3,000 (issued not presented) − 3,000 (deposited not collected) = 25,000, which equals the pass book balance. The equality is because two differences cancel; without the BRS the reasons would be unknown and other errors could be hidden.

Test your recall

Answer in your head or on paper first, then open the card. Pulling an answer out of memory makes it stick far better than re-reading.

1.What is a BRS?Show answer
A statement reconciling cash book and pass book balances.
2.Cheques issued not presented: add or deduct?Show answer
Add (from the cash book balance).
3.Bank charges not in the cash book?Show answer
Deduct.
4.Does a timing item need an entry?Show answer
No.
5.If you start from the pass book?Show answer
Reverse all signs.

Bank Reconciliation Statement: Timing Differences and BRS from the Cash Book Balance: frequently asked questions

Is the BRS a ledger account?

No, it is a statement.

Who prepares the BRS?

The firm, using its cash book and the bank's pass book.

How often is it prepared?

Usually monthly, or when the books are closed.