Reconciliation

Reconciliation is the process of matching financial records (such as accounting software, bank statements, invoices, and receipts) to ensure accuracy and identify discrepancies. Lenders rely on reconciled accounts when assessing applications for Business Loans, Working Capital Loans, and Invoice Finance. Related terms: Accounts Payable, Accounts Receivable, Cash Flow Forecast. Helpful hub: Business Owners Finance Hub.

If you want a practical example of how clean reconciliations support real-world funding decisions, have a look at our Business Cashflow System (WCL + LOC + Invoice) guide, which shows how lenders look at cashflow strength across multiple products.

Why Reconciliation Matters

Reconciliation ensures financial accuracy, which is essential for tax compliance, internal reporting, and financing. Lenders check reconciled accounts to verify stability and confirm the business’s true financial position.

• Prevents errors and fraud
• Confirms cashflow accuracy before applying for finance
• Strengthens lending applications with clean, verifiable data
• Helps track overdue payments and identify missing entries
• Ensures accounting software matches actual bank activity

How Reconciliation Works

• Compare accounting records with real transactions
• Match invoices to payments received
• Match bills to expenses paid
• Identify and correct mismatches or missing entries
• Update accounts to reflect true balances

Clean reconciliations give lenders confidence in your borrowing capacity and repayment reliability.

Official reference: business.gov.au