What Does it Mean?
Account reconcilement is the process of confirming that two separate records of transactions in an account are equal. This can happen internally within a bank or broker, for example, as between general ledger entries and individual account records.
Reconciling also occurs when a customer of a bank or broker confirms that their personal records match what is reported on their periodic statements. Account reconcilement can also refer to balancing the books and records of a business with software programs and data entries.
For Investor....
Account reconciliation within financial institutions is a key regulatory and compliance function, and it is a primary focus for outside regulators in their routine audits of the firm. Customers of these firms should also keep an accurate record and report discrepancies promptly..
With the advent of computer systems to record transactions and client positions, reconciling often amounts to fixing small discrepancies of a few dollars, or even pennies, between one source and another. The longer an error goes uncovered, the more difficult it will be to reconcile the two records.
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