Payment Reconciliation
Definition
Matching payments received or made against the corresponding invoices and bank transactions, so the records of what is owed and owing stay accurate and discrepancies are caught quickly.
Related Terms in Invoicing & Sales
Deposit Invoice
An invoice requesting an upfront partial payment before goods or services are delivered. The deposit is later offset against the final invoice for the balance.
Consolidated Invoice
A single invoice combining multiple orders, deliveries or periods for one customer, reducing paperwork and simplifying reconciliation for both parties.
Billing Cycle
The recurring interval over which a business invoices a customer — for example monthly or quarterly. A consistent billing cycle makes revenue and cash flow more predictable.
Credit Limit
The maximum amount a business allows a customer to owe at any time on credit terms. Setting and enforcing credit limits controls the risk of bad debts from over-extended customers.
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