Voting (accounting)

In accounting, reconciliation is a process that brings data from different accounts or accounting groups into agreement.

The double-entry accounting records the value of each individual company at multiple sites simultaneously. An example: When posting an incoming invoice, different accounts are addressed in debit and credit and the same amount is posted to; the invoice appears as an open item in a supplier account in the subledger and is also recorded as a liability in the general ledger. The incoming invoice in the accounts payable department of the recipient corresponds to the outgoing invoice in the accounts receivable department of the sender. The balances of all related parts of the overall system are checked routinely. If they do not match, the errors must be identified and corrected. The reconciliation can take place by comparing the individual items, aggregated values ​​or check digits.

Inconsistencies within bookkeeping can occur due to currency or rounding differences or technical errors. When coordinating separate systems, errors in data transmission, for example, and time shifts in the case of manual bookings, can be the cause of deviations. Objective reasons are also possible, for example if an invoice is not recognized by the recipient and is returned.

The coordination is successful if both sides show identical values ​​or the deviation is within the defined limit values. Larger differences are eliminated through adjustment postings. If a regular correction is no longer possible in the same accounting period , accruals may be necessary in order to correct the values ​​in the balance sheet and the profit and loss account . If the deviations are intentional or cannot be remedied, an explanation and documentation are necessary for reasons of proper accounting .