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They talk about "reconciliation". Is this the practice of moving actual money following a bank-to-bank transfer of money? Or is this strictly an auditing functi
by bdamm 10y ago
They talk about "reconciliation". Is this the practice of moving actual money following a bank-to-bank transfer of money? Or is this strictly an auditing function? Any bankers want to comment on this?
- scrumper 10y agoReconciliation is the frequently manual process of making sure your records match mine, and vice versa. It's burdensome in finance because of the proliferation of systems used at various stages of a trade, and the number of parties involved as well. Edit to expand on that a bit: it means making sure that every party involved in a trade has identical information. For a straightforward trade like an equity done on an exchange, it's more of an exception process. For more complex transactions where there are more data fields, it can be a very heavy process. Rough estimates put cost of reconciliation at tens of billions per year for banks, all of which has to be paid for somehow.