Your cashbook and your bank statement rarely match on the day — cheques haven't cleared, charges haven't been recorded. Enter both balances, list the differences, and this produces the reconciliation statement and tells you whether it ties out.
Add: deposits in transit — money you banked that isn't on the statement yet.
Less: unpresented cheques — cheques you issued that haven't cleared.
Add: direct credits — interest or receipts on the statement you haven't recorded.
Less: bank charges & direct debits — charges or standing orders you haven't recorded.
How it works: the adjusted cashbook = book balance + direct credits − bank charges. The adjusted bank = statement balance + deposits in transit − unpresented cheques. When your records are complete, the two adjusted balances are equal. Any difference means a missing or mis-posted item — check first for a transposed figure. Guidance to help you reconcile, not audited advice.