The variance is the difference between the balance in your accounting software and the balance at your bank.
A number, not a verdict
Some variance is normal and permanent. Money moves at different speeds through the two systems, so at any given moment they will differ by whatever is in flight.
What matters is the size and the direction over time, not the existence of a gap.
- A small variance that resolves within days is timing. Nothing to do.
- A variance that stays the same size for weeks is usually one specific unresolved item.
- A variance that grows steadily means something is being recorded in one place and not the other, and it will keep growing until it is found.
What causes a persistent one
In rough order of how often it turns out to be the answer:
A transaction the bank has and the books do not, usually from an interrupted connection.
A duplicate — the same payment recorded twice because it arrived through two systems.
An amount entered wrong, which is the least common and the one everybody checks first.
Why it is worth watching at all
The variance is the earliest signal that your reporting has stopped describing reality. Every figure built on your books — profit, margin, tax reserve — inherits the error, and none of them will look obviously wrong.
Resolving it is reconciliation. Doing it monthly keeps a discrepancy explainable; leaving it a year usually makes it unexplainable.