Bank Reconciliation
The monthly process of comparing the bank statement to the bookkeeping records to identify and resolve discrepancies between them.
Detailed Explanation
Reconciliation is foundational bookkeeping hygiene: missing transactions, duplicates, bank errors, and timing differences (outstanding checks, deposits in transit) are caught here. Software like QuickBooks Online and Xero automates the matching but human review is still required to resolve unmatched items. Books that are not reconciled monthly accumulate errors that compound through the year and become tax-time fire drills.
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Learn about Bookkeeping ServicesRelated Terms
Bookkeeping
The systematic recording, classification, and reconciliation of a business's financial transactions to produce accurate financial statements.
Chart of Accounts
The structured list of every account a business uses to record financial transactions, organized into assets, liabilities, equity, revenue, and expenses.
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