A proof of cash agrees the bank and the books on receipts and disbursements, not just on the ending balance. The slow part is getting monthly totals out of statement PDFs. Upload them here and every transaction comes back as a row you can pivot into the four columns in minutes. Start free, no credit card.
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The schedule itself is simple arithmetic. Sourcing the numbers that go into it is what takes the day, because the bank side of the proof lives inside twelve PDF statements.
Many statements show a summary of deposits and withdrawals, but plenty show only the running balance, so the totals have to be recalculated from the detail.
A twelve month proof means opening twelve PDFs and transcribing four numbers from each, with a transcription risk on every one.
Money moved between the company accounts inflates receipts and disbursements on both sides unless you identify and handle it consistently.
The general ledger cash account has to be totaled on the same monthly basis, which means the periods must match exactly.
Deposits in transit and outstanding checks belong in one month on the books and the next on the bank, and getting that wrong breaks the tie.
When the columns do not agree, you need the underlying transactions to find out why, which is impossible if you only captured the totals.
Convert the statements once and you get both the totals for the schedule and the detail behind them, which is what you need when the columns do not tie.
Date, description, debit, credit, and running balance in separate columns, so a pivot table produces monthly receipts and disbursements instantly.
Convert twelve statements and combine them into one continuous sheet with a month column, which is the shape the proof of cash wants.
The balance column carries through so the beginning and ending figures for each month come from the data rather than from retyping.
Because you have every line, tracking a variance down to the specific transfer or duplicate deposit is a filter rather than a re-read.
Image only PDFs are handled with OCR, so older paper statements still produce usable rows.
256-bit encryption in transit and you can delete uploaded files at any time.
From statement PDFs to a tied schedule.
Upload every monthly statement for the period. Download the rows as XLSX and stack the months into one sheet with a month column.
Tip: Include the month after period end.
Build a pivot table with month as rows and the sum of credits and the sum of debits as values. That gives you the bank receipts and bank disbursements columns.
Tip: Check the pivot total against the statement summary.
Put the general ledger cash totals beside the bank totals, add the reconciling items, and confirm each row foots and each column agrees.
Tip: Investigate variances using the detail rows.
It is a standard procedure in audit and transaction work, and a practical control in any business handling significant cash.
Test cash activity across the period rather than only the year end balance, especially where fraud risk is elevated.
Tie reported revenue and expenses to actual cash movement as part of buy side financial due diligence.
Detect skimming and lapping, where the ending balance reconciles but the activity does not.
Run it periodically on cash heavy accounts as an internal control over receipts and disbursements.
A proof of cash is a schedule that reconciles the bank and the books across four columns for a period: the beginning balance, receipts, disbursements, and the ending balance. A standard bank reconciliation only proves the ending balance agrees. A proof of cash also proves that the total money in and the total money out agree, which is why it catches errors and manipulation that a normal reconciliation cannot. If someone recorded a deposit twice and a payment twice, the ending balance still reconciles perfectly. The receipts and disbursements columns do not.
The schedule runs bank figures down the left and works toward the book figures, adjusting for the items that hit one side in a different period than the other. Here is the standard layout for a single month.
| Line | Beginning balance | Receipts | Disbursements | Ending balance |
|---|---|---|---|---|
| Balance per bank statement | Opening per bank | Total credits | Total debits | Closing per bank |
| Deposits in transit, opening | Add | Deduct | n/a | n/a |
| Deposits in transit, closing | n/a | Add | n/a | Add |
| Outstanding checks, opening | Deduct | n/a | Deduct | n/a |
| Outstanding checks, closing | n/a | n/a | Add | Deduct |
| Bank items not on books (fees, NSF) | n/a | Adjust | Adjust | n/a |
| Balance per books | Opening per GL | GL receipts | GL disbursements | Closing per GL |
Every row and every column has to foot, and that dual check is the whole point of the schedule. Horizontally, for each row: beginning balance plus receipts minus disbursements equals ending balance. Vertically, each of the four columns starts at the bank figure, moves through the reconciling adjustments, and ends at the book figure. If both directions foot, the cash activity for the period is proved. If a column fails, either the reconciling items in that column are wrong or the underlying activity does not agree, and you go to the transaction detail to find out which.
Take a month where the bank statement shows an opening balance of 42,000, credits of 310,000, debits of 288,000, and a closing balance of 64,000. That row foots on its own. Now assume deposits in transit were 8,000 at the start of the month and 11,000 at the end, and outstanding checks were 15,000 at the start and 9,000 at the end. Book receipts become 310,000 minus 8,000 plus 11,000, which is 313,000. Book disbursements become 288,000 minus 15,000 plus 9,000, which is 282,000. The opening book balance is 42,000 plus 8,000 minus 15,000, which is 35,000, and the closing book balance is 64,000 plus 11,000 minus 9,000, which is 66,000. Now check the book row: 35,000 plus 313,000 minus 282,000 equals 66,000. It foots, so the month is proved.
When the balances tie but the activity columns do not, the cause is almost always one of a short list. Interbank transfers recorded gross on one side and net on the other. A deposit recorded twice in the ledger and once at the bank. Bank fees or NSF returns never posted to the books. A journal entry that adjusted the cash account without a corresponding bank transaction, which is the classic place to hide a misstatement. Lapping, where receipts are applied to the wrong customer and the timing is covered by later collections. Each of those is found by comparing the converted transaction detail against the ledger for the month that failed, which is why keeping the line level data matters more than keeping the totals.
The practical bottleneck is the bank side. Convert each statement, stack the months into one sheet, add a month column, and pivot. Sum of credits by month gives bank receipts, sum of debits gives bank disbursements, and the balance column gives the opening and closing figures. Cross check the pivot totals against the summary box printed on each statement before you rely on them. To stack the files, see combine bank statements in Excel, and if the running balance is what you need most, running balance extraction covers it. Auditors running this as part of a cash testing program should start from the bank statement converter for auditors. For the plain reconciliation rather than the full proof, use the bank reconciliation template for Excel, and the reconciliation workflow page covers the monthly process. To convert the source files, the general bank statement converter and the PDF bank statement to Excel converter both produce the rows this schedule needs, and batch conversion handles a full year at once. If the next step is a cash flow view, see bank statement to cash flow statement.
A proved cash figure is usually an input to something else. If the output is a set of financials for a board or a lender, generating them from the tied numbers is quicker with an automated financial statement generator than rebuilding the presentation by hand each period.
A proof of cash is a schedule that reconciles the bank and the books across four columns for a period: beginning balance, receipts, disbursements, and ending balance. Unlike a standard bank reconciliation, which proves only the ending balance, it also proves that total cash in and total cash out agree between the two records.
Each row must satisfy beginning balance plus receipts minus disbursements equals ending balance. Each of the four columns must also reconcile from the bank figure to the book figure through the reconciling items. When both the rows and the columns foot, the cash activity for the period is proved.
A bank reconciliation agrees one number, the ending balance, at one point in time. A proof of cash agrees four numbers across the whole period, including total receipts and total disbursements. That makes it far better at detecting offsetting errors and deliberate manipulation, which leave the ending balance intact.
It is typically prepared when fraud risk over cash is elevated, when internal controls over receipts or disbursements are weak, during forensic investigations, and as part of quality of earnings work in a transaction. Some controllers also run it periodically on cash intensive accounts as a standing internal control.
Convert each monthly bank statement into rows, stack the months in one sheet with a month column, and pivot to get receipts and disbursements per month. Place the general ledger totals alongside, add the reconciling items for deposits in transit and outstanding checks, then confirm every row and every column foots.
It means the activity disagrees even if the balances match. Common causes are interbank transfers recorded inconsistently, a deposit posted twice on one side, bank fees or NSF items never recorded, or a journal entry to cash with no corresponding bank transaction. Investigate using the transaction detail for the failing month.
Prepare it monthly rather than annually. An annual proof of cash can be defeated by errors that reverse within the year, and it gives you no way to narrow where a variance came from. Monthly columns isolate the problem to a single period, which is what makes investigation practical.
Yes. Image only PDFs are processed with OCR so the transactions still come back as rows. Because the schedule depends on totals being exactly right, cross check each converted month against the summary of deposits and withdrawals printed on the statement before you use the figures.
Cash testing and audit workpapers.
The standard monthly reconciliation.
Trace activity for fraud investigations.
Stack twelve months into one sheet.
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