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Net banking shows a different balance from the statement closing balance, and the accountant does not know which figure to reconcile to.
Reconcile to the ledger balance on the statement date; treat the available balance as a usable-funds figure affected by liens, holds, pending debits, uncleared items and overdraft limits.
Use the statement closing balance for the period end. Note any lien or limit separately in the working paper; do not adjust the BRS for them.
A BRS anchored on the bank's printed ledger balance, with liens and limits disclosed as notes rather than reconciling items.
Use the ledger (book) balance printed on the statement for your reconciliation date. The available balance you see in net banking can be higher or lower because of liens, holds, pending debits, uncleared items and any overdraft limit. It tells you what you can spend now, not what the bank has recorded.
What do ledger, available and clear balance mean in an Indian bank app?
Banks label these differently, but the ideas are the same.
| Term | Plain meaning | Example (₹) |
|---|---|---|
| Ledger balance (also book balance, closing balance) | Total of every entry the bank has posted to your account | 2,83,500 |
| Available balance (also usable balance) | What you can withdraw or pay out right now | 2,58,500 after a ₹25,000 lien |
| Clear or cleared balance | Part of the balance made up of funds that have finished clearing (definition varies by bank) | 2,83,500 if nothing is pending |
Your cash book records transactions, not limits or blocks. So the figure it should agree with, after reconciling items, is the ledger balance.
Why does net banking show a different figure from the statement closing balance?
The common causes are below. How each one is shown is decided by your bank, so check its own help page if a difference puzzles you.
| Cause | What happens | Effect on available balance |
|---|---|---|
| Lien or hold | The bank blocks part of the balance, for example against a fixed deposit loan, a bank guarantee or a court order | Lower |
| Pending debit | A card payment or transfer is authorised but not yet posted | Lower |
| Uncleared cheque deposited | Some banks show the deposit but do not let you use it until it clears; others do not show it at all yet | Often lower than the figure including the cheque |
| Overdraft or cash credit limit | The unused limit is added to what you can draw | Higher |
| Time of viewing | A mid-day view misses entries posted later that day | Either way |
None of these are entries in your books. A lien does not move money. An overdraft limit is borrowing you have not used. They are not reconciling items.
A worked example
A trading firm’s current account statement for 31 March shows a closing (ledger) balance of ₹2,83,500. The bank has marked a lien of ₹25,000 against a bank guarantee. Net banking therefore shows:
Available balance = ₹2,83,500 − ₹25,000 = ₹2,58,500.
The firm’s cash book shows ₹2,65,500. The accountant ticks the statement and finds one cheque issued for ₹18,000 not yet presented.
From the cash book: ₹2,65,500 + ₹18,000 = ₹2,83,500.
That equals the ledger balance, so the BRS is complete. If the accountant had used the available balance of ₹2,58,500, there would be an unexplained ₹25,000 gap, and they might have hunted for a missing entry that does not exist.
If the same account also had an overdraft limit of ₹1,00,000, net banking might show an available balance of ₹3,58,500 (₹2,58,500 + ₹1,00,000). The BRS would still use ₹2,83,500.
The lien is worth a note in the working paper (and possibly in the financial statements, as a restriction on cash), but it is not a line in the BRS.
Where do these balances sit in a bank statement file?
If you download statements as Excel or CSV, the closing balance column on the last line of the day is the ledger balance. Electronic bank statement formats used by larger companies carry the opening and closing ledger balances in separate fields, with available balances tagged on their own. Knowing which field is which stops you loading the wrong figure.
What to read next
- Next in this series: How do you reconcile an overdraft or cash credit account?
- Go deeper: MT940 vs CAMT.053 vs MT942 bank statement formats
- Go deeper: Bank statement column variants and how to parse them
- For teams: Bank reconciliation software for India
TransactIG matches bank statement lines to your books and reconciles to the statement’s own balances, with unmatched lines in an exception queue.