Prepare a three-balance comparison by identifying one account, one cut-off date, and the complete report set. Then compare the adjusted bank balance, the trust-book balance, and the total of the relevant beneficiary ledgers. The comparison is useful only when the reports cover the same population.
Establish the boundary first
Write the bank-account identifier, property-management system, report date, and export time at the top of the workpaper. Keep operating accounts outside the comparison unless they belong to a separately defined reconciliation.
Confirm what each report includes. An owner report limited to active properties may omit records needed for an account-wide comparison. A total can look plausible while the report scope is incomplete.
Bring the bank to the same basis
Start with the statement balance and identify supported reconciling items such as outstanding payments or deposits in transit. Every adjustment needs a date, amount, and source reference. The resulting adjusted bank balance is the figure being compared with the books.
This guide describes an operational comparison. It does not prescribe a state-specific trust-account procedure or certify compliance.
Illustrative comparison
| Record | Amount |
|---|---|
| Bank statement balance | $85,000 |
| Less supported outstanding payment | ($750) |
| Adjusted bank balance | $84,250 |
| Trust-book balance | $84,250 |
| Relevant beneficiary ledger total | $84,250 |
The figures agree in this example. That does not prove every underlying entry is correct: offsetting errors can still exist. Keep the source reports and the outstanding-payment evidence with the comparison.
Investigate the first unexplained difference
If the adjusted bank and books differ, begin with account activity and reconciling items. If the books and beneficiary total differ, inspect the ledger population, posting references, and report filters. Do not skip directly to an entry designed to make the totals agree.
Record the amount, suspected cause, evidence required, and person responsible for the next step. If a report must be rerun, keep the original export so the change can be explained.
Finish with a useful status
The workpaper should say either that the defined comparison agrees with supporting records, or that a listed difference remains unresolved. Keep the wording narrower than a blanket assurance about the entire account.
Use the three-balance workpaper to capture the comparison and its limitations in one place.
Sources and further reading
- IRS: choosing and maintaining business records
- Intuit: reviewing a first reconciliation and opening balance
- California DRE: reconciliation of accounting records (conceptual background, pages 8–9)
Source links provide background. The workflow and illustrative examples above are original educational material.