Reconcile the lender statement before assuming the wage loan is shrinking

Regular repayments may feel like progress

Money leaves the account every day, so you assume the emergency wage loan is steadily reducing. Then the lender's statement shows a larger balance than expected. Reconcile the figures before making decisions about another advance or payout. Ask the accountant and adviser to explain the actual movement rather than relying on the total debited from the bank.

Gather the same period on both sides

Imagine a hospitality business that borrowed to meet payroll during a quiet month. Obtain the loan agreement, repayment schedule and lender statement for the period under review. Match them to the bank transactions. Use the same start and end dates so a payment arriving after the statement cut-off is not mistakenly treated as missing or charged twice.

Keep the underlying records secure

business.gov.au recommends maintaining reliable business records and protecting them against unauthorised changes. Preserve the original statements and work on a separate reconciliation. Record opening balance, advances, charges, repayments and closing balance. Keep an unexplained difference visible rather than changing the opening figure until the arithmetic appears to work. The unresolved amount is a question to investigate.

Source: business.gov.au: Record keeping

Ask how payments were applied

Request clarification where the statement does not explain the treatment of payments or charges. Compare the response with the agreement through the appropriate adviser. In the hospitality example, the amount debited may not equal the reduction in principal. Do not infer an annual interest rate from a repayment figure alone or label an unfamiliar charge unlawful without checking its basis.

Distinguish balance from payout

Ask the lender for the relevant current information if repayment or refinancing is being considered. A statement balance for last month may differ from the amount required to close the facility on another date. Have any conditions and additional amounts explained before relying on a figure in a funding proposal. Keep a quote's date and assumptions visible to everyone assessing it.

Use the result in the broader review

Give the reconciled position to the accountant when assessing whether the business can support the loan. If the loan is funding continuing losses or debts cannot be paid, seek qualified advice promptly. A clear statement reconciliation will not make expensive borrowing affordable, but it prevents management from mistaking repeated bank debits for a reliable measure of progress.