What is the main purpose of the reconciliation?

A company's cash balance at bank and its cash balance according to its accounting records usually do not match. This is due to the fact that, at any particular date, checks may be outstanding, deposits may be in transit to the bank, errors may have occurred etc. Therefore companies have to carry out bank reconciliation process which prepares a statement accounting for the difference between the cash balance in company's cash account and the cash balance according to its bank statement.

Reconciliation is not required by any standard or framework but is an internal or management report. Its objective is mainly to identify any differences in the ledger your organisation holds of your supplier with the ledger your supplier has maintained. Differences are either temporary like the lead time in invoicing of supplies before reaching you and other adjustments

related to what kind of reconciliation

1- reconciling banking to detrmine the cash out and in the bank with the cheques, swifts, that had entered or out from the bank "Matching the amount in bank with our records"

2- Reconciling or adjusting trial balance is to rectifing the right entries and its direction in the chart of accounting "Financial reporting according to FASB"

3- reconsiling cash with invoices "detremine the accrual basis"

The main purpose ot bank reconciliation is to be able to monitor the in and out of cash from the bank and able to monitor whether there are unusual transactions made in the bank that are not in the book, this could also be a tool for fraud-free company.

It is used for comparing the cash book with the bank statement to see if there are any differences between these two sets of records for your cash transactions.

Reconciliation is a tool used to compare cash in books against cash in the bank in order to make sure that both accounts do balance.

Reconciliation simply means verifying to figure out what is wrong.We are required to reconcile when something doesn't add up or match.when working in an accounts dept. you're likely to encounter such situations. Bank Reconciliation :you need to make sure that your monthly bank statement matches with your general ledger records. if it doesn't, you will need to reconcile and see what is missing.Balance sheet Reconciliation :your accounting equation should always balance : Assets = Liability  + Equity.if it does not, you need to recheck your journal entries and see if you have considered all the correct accounts and if the amount is correct.Customer/ Vendor account reconciliation :We all encounter customers who tells us something has been paid when it clearly is open in our records or vice versa. This could be due to incorrect payment allocation by either parties. An account reconciliation will help you in resolving the customer dispute.

Bank reconciliations are an important accounting procedure, performed by companies of all sizes, to match the cash balance of the bank with the balance found on the company's financial records. Reconciliations can detect and prevent intentional fraud, along with errors by bank tellers, accountants, employees and management. Although bank reconciliation is typically a month-end procedure, companies with smaller cash resources might perform it daily.