What does "vendor reconciliation" involve?

Vendor reconciliation involves comparing accounts payable records with vendor statements for accuracy. This process ensures that the amounts recorded in the accounts payable ledger match the balances reported by vendors. By performing this reconciliation, organizations can identify discrepancies, such as missing invoices, overpayments, or billing errors. Accurate vendor reconciliations are crucial for maintaining healthy vendor relationships and ensuring the integrity of financial records, as they help prevent issues that could lead to disputes or delayed payments.

While the other options mention important aspects related to vendor management, they do not specifically describe the primary function of vendor reconciliation. For instance, reviewing vendor quality and performance pertains more to supplier evaluation processes rather than financial accuracy. Assessing vendor discounts and offers falls under procurement and negotiation strategies rather than reconciling accounts. Validating employee expenses against vendor invoices is an entirely separate process that deals with employee reimbursements rather than the reconciliation of vendor account balances.