A monthly reconciliation (also known as account reconciliation) is the process of comparing your business’s internal financial records—such as your general ledger or bookkeeping software—with external statements like bank, credit card, or loan statements to ensure they match. In short, it’s a monthly routine that verifies whether every transaction has been accurately recorded, categorized, and accounted for.

Good financial management isn’t about reacting to problems—it’s about preventing them. One of the most overlooked but essential practices for small business owners is monthly account reconciliation. It may sound like “just another bookkeeping task,” but in reality, reconciliation is the backbone of accounting hygiene—keeping your financial records accurate, trustworthy, and ready for decision-making.