Which term describes the process of comparing estimated or budgeted amounts to actual usage or costs and adjusting differences to align accounts?

• A. annual review
• B. budget billing
• C. reconciliation
• D. speech and language development

Answer: (C)

Reconciliation is the process of comparing estimated or budgeted amounts to actual usage or costs and making adjustments so the accounts match reality. In practice, you compare the forecast with what actually happened, spot variances, and then post correcting entries or adjust the records so the ledger reflects true activity. This keeps financial statements accurate, supports audit trails, and helps identify errors or gaps in data (like missing invoices or data-entry mistakes).

Annual review describes evaluating performance over a year, not the act of aligning accounts. Budget billing is a payment method that averages costs for easier budgeting, and speech and language development is unrelated to accounting.