What is the purpose of regular reconciliations between ledgers and bank statements?

• A. To extend the grant period.
• B. To detect errors, ensure accuracy of funds, and support financial reporting.
• C. To adjust personnel records.
• D. To determine future funding needs.

Answer: (B)

Regular reconciliations between ledgers and bank statements focus on making sure cash records are accurate by confirming that what the organization has recorded matches what the bank shows. This process helps catch timing differences, data entry mistakes, missing transactions, or potentially unauthorized activity, and it provides a trustworthy basis for financial statements, audits, and grant reporting. That makes it the best choice because it directly supports accurate funds tracking and reliable reporting. Actions like extending a grant period, adjusting personnel records, or forecasting future funding needs are separate tasks—program management, HR data maintenance, and budgeting/forecasting, respectively—not the primary purpose of reconciliations.