Reconciliation | Meaning and Definition

What is Reconciliation?

The reconciliation meaning is the method in which there will be a comparison of two records, and there will be a check whether the two records are the same or different in terms of finance. Regarding the HR department terms, the reconciliation definition is a process in which the department of payroll of either a small-scale business or a large-scale business will properly evaluate the salaries mentioned in the paper and the salary paid to the employees of the organization. 

The salary mentioned in the paper is not altogether paid to the employees working in the organization. But there is always some deduction and pay cut due to some insurances, taxes, etc. So, proper documents should be available regarding the company’s finances, i.e., the amount of salary paid to the employees, the amount of salary mentioned in the paper, the amount of salary that has been deducted, and the reason behind the deduction. Otherwise, there can be huge trouble in the business in the future. This is one of the most important processes taking place in the organization as it determines the financial status of a company.

Streamline Your HR Tasks with Zimyo HRMS
Get Free Trial