Two causes of difference in the balances of cash book and pass book.
(i) Difference due to time gap between recording a transaction by firm and bank like, cheques issued but not presented for payment, cheques deposited into bank but not yet cleared
(ii) Difference due to entries which are accounted by bank but are recorded by cashier at firm on receiving the pass book statement. Like entries of bank interest, bank charges, interest or dividend collected, direct payments by bank etc
(iii) Errors or omission by cashier or by Bank.
