The different types of reconciliation include bank, customer, vendor, intercompany, and business-specific reconciliation.
Bank reconciliation is when you attempt to match your bank statement with your business records and accounting ledgers to ensure they are in sync.
Customer reconciliation is when you compare and verify information from business records and accounting ledgers to customer balances.
Vendor reconciliation is when you match vendor invoices to purchase orders, ensuring the accuracy of inventory levels and payments.
Intercompany reconciliation is when you sync accounting records between two or more separate legal entities that are part of one single entity.
Business-specific reconciliation varies according to organizational needs and business activity. For example, a firm that manufactures products may physically count its inventory and compare it against the inventory reflected on its books and records.