What Does Adjustment Mean on a Bank Statement?

A bank statement provides a summary of all financial transactions for an account within a specific period. It details deposits, withdrawals, and other activities, showing an account’s financial inflows and outflows. Regularly reviewing these statements is fundamental for financial transparency and managing personal finances. They serve as a record for budgeting, identifying unusual activity, and ensuring account balance accuracy.

Understanding Bank Statement Adjustments

An “adjustment” on a bank statement is a modification or correction applied to an account’s balance directly by the bank. These entries are initiated by the financial institution for various reasons, distinct from typical deposits or withdrawals. Banks process adjustments to correct errors, fulfill specific transaction requirements, or apply standard charges and interest. Not all adjustments indicate a problem; some can increase the balance, while others may decrease it.

The purpose of these adjustments is to ensure the accuracy and integrity of financial records. If a bank identifies a processing error, an adjustment rectifies the balance. Account-related fees or credited interest also appear as adjustments. Understanding these entries is important for reconciling personal records with bank records, providing a complete financial overview.

Common Types of Bank Statement Adjustments

Bank errors and corrections are common adjustments. They occur when the financial institution rectifies a mistake, such as a misposted deposit, an incorrect charge, or a transaction processed for the wrong amount. The bank posts an adjustment to debit or credit the account to reflect the accurate balance. While banks strive for accuracy, such discrepancies can occur and require correction.

Returned item adjustments are frequent. These include instances where a check deposited into your account “bounces” due to insufficient funds, or an electronic payment is returned. The bank initially credits your account for the deposit, then debits the amount back out via adjustment, often with a fee. A returned electronic payment, such as an Automated Clearing House (ACH) transaction, results in an adjustment to reverse the initial credit or debit.

Interest earned or paid is another adjustment type. For interest-accruing accounts, the bank periodically credits earned interest. This positive adjustment increases the account balance. Conversely, on credit products or overdraft lines, interest charges appear as a debit adjustment.

Bank fees frequently appear as adjustments on statements. These can include monthly service fees, overdraft fees, ATM fees, or foreign transaction fees. The bank directly deducts these charges from the account balance, shown as debit adjustments. Understanding the fee schedule associated with your account helps anticipate these entries.

Reversals undo previous transactions. This can happen if a merchant refunds a debit card charge, or an accidental duplicate charge is corrected. The original transaction is canceled out by the reversal, which appears as a credit to your account. These adjustments restore funds that were previously debited.

Automated Clearing House (ACH) adjustments pertain to electronic funds transfers. These can include corrections for unposted debits or credits, or situations where an ACH payment fails due to an invalid account number or insufficient funds. When an ACH transaction is reversed, an adjustment reflects the return of funds or the reversal of a payment.

Steps to Take After Seeing an Adjustment

Upon noticing an adjustment on your bank statement, first review and verify it. Compare the adjustment against your personal financial records (receipts, transaction logs, or budgeting software) to determine if it aligns with expected activity. This cross-referencing helps ascertain whether the adjustment is legitimate (e.g., an anticipated interest payment) or if it represents an unexpected or erroneous entry.

If the adjustment is unfamiliar or appears incorrect, gather all relevant information from your statement. Note the date of the adjustment, the exact amount, and any descriptive text provided by the bank. Having these specific details streamlines any subsequent inquiries. Collect any supporting documentation, such as receipts for disputed transactions or records of communications with merchants.

Promptly contact your bank to inquire about the adjustment. Most bank statements include a customer service number, or you can find contact information through their official website or mobile application. Clearly explain the situation, providing the date, amount, and description of the adjustment. Ask for a detailed explanation of why the adjustment was made and how it affects your account balance.

Document all communication with the bank. Keep a record of the date and time of your calls, the names of the representatives you speak with, and a summary of your discussions. If you send written correspondence, retain copies for your records. This documentation is invaluable if further action or follow-up is required to resolve the issue.

If the adjustment issue is not resolved to your satisfaction within a reasonable timeframe, follow up with the bank. Refer to your documentation of previous communications and reiterate your concern. Most financial institutions have established procedures for handling disputes and correcting errors, which may involve further investigation or escalation to a specialized department.