The purpose of an account reconciliation reconciliation is to confirm that the account balance is accurate, valid, and complete. An reconciliation compares the account balance between the General Ledger and the outside source. Any outstanding items (unmatched) should be researched to determine if an Adjusting Journal Entries (AJE) is necessary.
Example:
Account balance for the
Simply defined, an Account Reconciliation is a comparison between an account balance according to the General Ledger or Trial Balance and what Authoritative Supporting Documentation (ASD) tells us the account balance should be, and a detailed explanation for any differences between the two. Account Reconciliations often determine any Adjusting Journal Entries (AJE) necessary to ensure that account balances are fairly stated. Account Reconciliations are to be performed for Balance Sheet/Statement of Financial Position accounts that represent asset or liability balances to be presented at a point in time, most commonly at month-end or fiscal year-end dates.
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