Business Glossary

adjusting the difference between two items (i.e., amounts, balances, accounts, or statements) so that the figures agree. The practitioner often has to analyze the deviation between two items, such as in preparing a bank reconciliation . For example, a reconciliation occurs when comparing the home office books account related to branch transactions with the corresponding account on the branch office books related to home office transactions. These two accounts are adjusted for the reconciling items causing the difference.

in appraisal , the process of considering values from the applicable approaches to provide a final estimate of the value of the subject being appraised.

Example: An appraiser arrives at the market value estimates shown in Table 44 following application of the 3 traditional approaches.

TABLE 44
RECONCILIATION
Market comparison:	$185,000
Cost approach:	$189,000
Income approach:	$184,000

In reconciliation, the appraiser considers the appropriateness of each approach to the subject, the quality of available data, and the amount of judgmental adjustments required to reach each estimate. Following this review, the appraiser settles on an estimate of $185,000 as her opinion of market value .

bringing together after a difference; resolution of a difference. It may be an amount or an opinion. In personal finance, it is the process of determining agreement between the bank balance per books with the bank statement. In real estate appraisals, reconciliation is the thought process of weighing all the available information from all appraisal approaches used to estimate the value of the subject being appraised.