How does a company identify discrepancies during a bank reconciliation?

A company identifies discrepancies during a bank reconciliation primarily by aligning transactions in the cash account with the bank statement. This process involves matching each transaction recorded in the company's cash account to those listed on the bank statement. By doing so, the company can spot differences such as outstanding checks, deposits in transit, bank fees, or errors in recording transactions. These discrepancies can affect the cash balance reported in both the company's financial records and the bank statement, making it essential to reconcile the two to ensure accuracy and completeness in financial reporting.

While comparing accounts payable and accounts receivable, measuring total revenues against total expenses, or reviewing sales performance metrics are important financial practices, they do not specifically address the reconciliation process between a company's cash records and its bank account. Thus, they are not effective methods for identifying discrepancies during a bank reconciliation.