Escrow Reconciliation Requirements

Reconciliations should at minimum include the following reports:

1. Summary Page - One page summary stating the total bank balance, total outstanding deposits, total outstanding checks/wires out, and adjusted bank balance, which is the sum of these totals (Bank balance + outstanding deposit – outstanding checks = adjusted balance).
2. Bank/Sweep Statement - Copy of bank/sweep statement for period being reconciled.
3. Outstanding Deposit List - Itemized report showing each outstanding deposit up to the period being reconciled.
4. Outstanding Check Report - Report showing date issued, check number, amount, and payee for any outstanding checks/wire outs that have not cleared the bank as of the period being reconciled.
5. Trial Balance - List of files with balances showing each individual file balance as of the period being reconciled (To be in balance the trial balance report net total should equal the adjusted balance on the summary page).

Review escrow reconciliations for accuracy and items needing follow-up.   

Match the figures listed on the summary page of the reconciliations to the corresponding reports in the escrow account reconciliation (ending bank balance to bank statement, outstanding deposits to outstanding deposit list, outstanding checks to outstanding check list, trial balance to adjusted bank balance).

The following is a formula to verify the reconciliations are in balance: 

Reconciliation formula:

Ending bank statement balance
Plus outstanding deposits
Minus outstanding checks
Equals adjusted bank balance or ending balance, which should also equal trial balance.

»          If the trial balance is more than the adjusted bank balance then account is out of balance, which would mean the account is short.

»          If the trial balance is less than adjusted bank balance than your account is out of balance by a positive figure, which would mean you have an overage of funds in your account.

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