Reconciliations are an essential part of keeping accurate financial records. In accounting terms, a reconciliation is the process of comparing the differences between two documents, such as bank statements and financial books, to ensure that they match. It involves day-to-day tracking of all deposits and withdrawals, ensuring that all items have been correctly accounted for, and ensuring that no errors or discrepancies remain in the books. Without proper reconciliations, businesses may face inconsistencies in their financials and run the risk of costly mistakes or inaccuracies. Doing regular reconciliations, however, can help businesses stay organized and on top of their finances and avoid costly issues down the line.