What term refers to the process of ensuring that a financial account's balance matches the balance on a bank statement?

The process of ensuring that a financial account's balance matches the balance on a bank statement is referred to as reconciliation. This process is essential for maintaining accurate financial records. It involves comparing the amounts in your accounting records with those shown on the bank statement to identify any discrepancies, such as errors in recording transactions, fees not accounted for, or checks that have not yet cleared.

By performing reconciliation, organizations can confirm that their financial data is correct and up to date, which helps prevent fraud and mismanagement of funds. This accuracy is crucial for effective financial reporting and planning. In contrast, audit pertains to reviewing financial statements for accuracy, budgeting involves planning future financial activities, and forecasting is about predicting future financial conditions based on current trends.