I've downloaded all my transactions, or have bank feeds connected, why does the accountant also need the bank statements?
You have bank feeds set up to send your daily transactions to your accounting software. Or you've downloaded all the transactions from your online banking to a .csv (aka Excel) file, and provided that to your accountant. Why are the actual bank statements necessary?
The reason is that we can't prepare the month end (or year end) bank reconciliation without the month end balance from the bank statements. The bank reconciliation is a cornerstone to bookkeeping. But the .csv file doesn't have the bank balance at the end of each month, it just has the transactions with no running total.
We perform the bank reconciliation at the period end, after we've reconciled all the transactions. Xero (accounting software) will show the ending Bank balance on June 30 (for example), which is sum of the opening Bank balance on June 1, plus/(minus) all the individual spend or receive money transactions during the month. If the June 30 cash balance on the bank statement matches to the Xero balance, then we know we haven't missed transactions, and our opening balance is correct.
If the balances don't match, then we investigate but going line by line through the bank statement. Transaction downloads aren't perfect, and sometimes a day or half a day is missed, or even one transaction. Sometimes transactions are duplicated. Other times human error can result in data being deleted or altered. The actual bank statement is the truth.
Further, we need to attach the year end bank statement to our Working Paper file when we complete the Notice To Reader financial statements and Corporate Tax Return. The CRA and CPA Alberta can both request this year end bank statement at any time within 7 years. We, as CPA's are required to have all the documentation to support the Balance Sheet items in the financial statements and tax return - especially Cash.