{"id":"concept:reconciliation-difference","kind":"concept","label":"Reconciliation Difference","synonyms":["reconciliation gap","discrepancy"],"definition":"A reconciliation difference is the specific dollar gap between what a ledger says an account holds and what the actual bank statement says, computed as the statement balance minus the ledger balance.","summary":"The exact number reconciling surfaces when things don't match. If uncategorized transactions in the account happen to sum to that exact figure, that's a strong lead — but only a lead, since a matching total proves the arithmetic lines up, not which specific transactions actually caused the gap.","explanation":["A reconciliation difference is the precise, signed dollar figure left over when a ledger balance and a real bank or card statement balance don't agree, computed as the statement's balance minus the ledger's. A positive difference means the bank shows more than the books; a negative one means the books show more than the bank.","The first thing checked against this figure is whether the uncategorized transactions sitting in that account happen to sum to exactly the difference. If they do, and there's only one uncategorized transaction with that exact amount, that's a strong, specific lead — categorizing it should close the gap. It's worth being precise about what this does and doesn't prove: a matching total only proves the arithmetic lines up, not that this particular transaction is definitely the cause. Two unrelated errors can coincidentally net out to the same figure.","If nothing uncategorized adds up to the gap at all, the cause is somewhere else entirely — a transaction the bank shows that never made it into the books, a duplicate entry, or something posted with the wrong date. At that point, the right move is looking for a missing, duplicated, or misdated transaction, not continuing to stare at what's already categorized.","A reconciliation difference of exactly zero means the ledger and the statement agree in full — though even then, uncategorized transactions can still be sitting in the account if an unrelated error elsewhere happens to offset them, which is why a perfect match isn't automatically the end of the story either."],"commonMistakes":["Treating a matching total between uncategorized transactions and the difference as proof of the specific cause, rather than a lead worth checking first.","Giving up when nothing uncategorized explains the gap, instead of looking for a missing, duplicated, or misdated transaction elsewhere.","Assuming a zero difference means nothing needs review — uncategorized transactions can still be sitting in the account even when the totals happen to match."],"category":"close","questions":[{"question":"If my uncategorized transactions add up to the reconciliation difference, is that the actual cause?","answer":"It's a strong lead, not proof — a matching total only shows the arithmetic lines up. Two unrelated errors could coincidentally net to the same figure."},{"question":"What if nothing uncategorized explains the gap?","answer":"Stop looking at what's already categorized and look for what's missing instead — a transaction never imported, a duplicate, or something posted with the wrong date."}],"url":"/glossary/reconciliation-difference","relatedTo":[{"id":"concept:reconciliation","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Areconciliation"},{"id":"concept:ending-balance","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Aending-balance"},{"id":"concept:uncategorized-transaction","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Auncategorized-transaction"},{"id":"concept:cleared-transaction","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Acleared-transaction"},{"id":"tool:reconcile_account","relationship":"references","weight":0.7,"api":"/api/knowledge/tool%3Areconcile_account"},{"id":"guide:what-to-do-when-your-books-dont-balance","relationship":"references","weight":0.7,"api":"/api/knowledge/guide%3Awhat-to-do-when-your-books-dont-balance"}],"referencedBy":[{"id":"concept:trial-balance","label":"Trial Balance","url":"/glossary/trial-balance"},{"id":"concept:uncategorized-transaction","label":"Uncategorized Transaction","url":"/glossary/uncategorized-transaction"},{"id":"concept:reconciliation","label":"Reconciliation","url":"/glossary/reconciliation"},{"id":"concept:cleared-transaction","label":"Cleared Transaction","url":"/glossary/cleared-transaction"},{"id":"concept:anomaly-detection","label":"Anomaly Detection","url":"/glossary/anomaly-detection"}],"license":"https://creativecommons.org/licenses/by/4.0/","attribution":"BalanceMCP — https://balancemcp.com"}