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Reconciliations are the process of finding any discrepancies between two set of accounts. As far as outstanding cheques for previous month is cleared in current month it should not appear in reconciliation statement for current month.
Bank reconciliation is between the entries you have recorded in system & the entries shown in bank statement, you have to knock of both the entries and which ever is left is not reflecting on either side is your reconciliation items.
If you have a previous month reconciliation and if you are doing for current month you have to knock off the entries showing in you previous reconciliation comparing with your current month bank statement.
