Bank Reconciliation

Reconciliation in accounting is the process of ensuring that two sets of records are in agreement. This typically involves comparing financial statements, transaction records, or balances from different sources to identify any discrepancies. Common types of reconciliation include bank reconciliation, where a company's financial records are compared against its bank statements to ensure accuracy, and accounts receivable reconciliation, which involves matching customer payments recorded in the accounting system with actual receipts.

The reconciliation process helps maintain accurate financial records, detect errors or fraudulent activities, and ensure compliance with accounting standards. It is an essential internal control mechanism that provides confidence in the integrity of financial reporting, ultimately supporting informed business decisions. Regular reconciliation fosters transparency and accountability within an organization’s financial operations.

Category:Bank Reconciliation