Reconciliation is a simple and visual process of matching up the transactions listed in an account's register against a paper or electronic statement provided by a financial institution. If differences do exist, then any missing or erroneous transactions must be addressed until the differences are resolved. Statements should come from you bank, investment broker, credit card issuer, etc. on a periodic basis.
Periodically reconciling an account helps ensure transaction entry errors do not creep in over time. Reconciliation is also a great tool for monitoring your accounts for fraudulent transactions.
Accounts may be reconciled using a manual process or using the Reconciliation Wizard. For any given reconciliation period, using a combination of both methods will be difficult.
Regardless of the Reconciliation process used, it is good practice to reconcile all accounts periodically.