All 23 Reconciliations questions
More in Reconciliations
What is a control account and how does it relate to reconciliations? What is the difference between a two-column and a running reconciliation? Why are regular reconciliations important for fraud prevention? What is the frequency at which key reconciliations should be performed? How do you reconcile a supplier statement to the AP ledger? What is the GR/IR reconciliation and why does it matter? How do you reconcile intercompany AP/AR balances? How does automation (reconciliation software) improve the process? How do you reconcile accounts receivable to revenue? What is a three-way reconciliation (e.g., for trust/client accounts)?
Advertisement
Back to results for “Cash Application”
Accounts Payable & Receivable › Reconciliations

What are reconciling items and how are they classified?

Intermediate

Answer

Reconciling items are the differences that explain a gap between two records. They're classified as timing differences (will self-correct, e.g., deposits in transit), permanent differences needing an adjusting entry (e.g., bank fees), and errors requiring correction. Documenting each with an action and owner is key to a clean reconciliation.
Real-world example A reconciliation lists a deposit in transit (timing), a bank fee (adjust books), and a miskeyed invoice (error to fix).

Common follow-ups: Which reconciling items need journal entries? | Why document an owner for each item?

Cash Application Aging Analysis Reconciliations
All 23 Reconciliations questions