Reconciliation: definition, example, and why it matters

Reconcile monthly to catch missed deposits, double charges, and unauthorized transactions. Trades that go 6+ months between reconciliations almost always find errors.

• Short definition. Matching your books against your bank statement to confirm every transaction.
• Category. Reconciliation is a accounting term used by service businesses when billing customers.
• How Glo Invoice handles it. Glo Invoice builds reconciliation into the invoice itself, so you don't track it on paper or in a spreadsheet.

Frequently asked questions

What does reconciliation mean?

Reconcile monthly to catch missed deposits, double charges, and unauthorized transactions. Trades that go 6+ months between reconciliations almost always find errors.

Related terms

• Cash flow — The net movement of cash into and out of a business over a period.
• Audit trail — A complete chronological record of every change made to a financial document.