The word is Reconciliation. Have you heard of it before? Do you know what it means?

I will tell you all about it, but first you need to understand...

                 THE RULE OF FOUR

You already know the Rule and use it every day. But it is so automatic and natural that you don't even know you are using it. For example...

Suppose there were 2 cookies in the cookie jar and with your mothers help you bake 12 more. At dinner time you tell your mother that you were not very hungry. She said that you must have filled up on cookies after being told you could only h ave one. How many cookies did you eat, she asked?

You answer that you only had one. Now you are in double trouble - trouble for not telling the truth, and trouble for disobeying your mothers instructions. Your mother then went to the cookie jar and found 6 cookies remaining and knew that you had eaten 8 cookies. How did you know that, you asked?

Because, she said, of the Rule of 4. It applies to everything and anything that can be counted. Some call it Gods Law, and others refer to it as a Law of Nature. By any name it is a law that cannot be changed. It's like the Law of gravity where if something, anything, slips from our hands, it crashes to the floor.

She said she knew there were 2 cookies before we baked the new batch, plus the 12 we baked, made 14 available to be eaten. With only 6 remaining out of the 14 available, meant that you had eaten 8 and its no wonder that your not hungry.

Now--to your punishment. She said, you are to eat the remaining 6 cookies for your dinner and for you to tell me how the Rule of 4 applied to describe what has happened here..

He responded saying that he apologized for not being truthful and obedient. That he appreciated the Rule of Four lesson and that he would never get caught in that trap again.

He continued, as to how the Rule applies, saying that the starting point is when there were only 2 cookies. To that we added 12 freshly baked cookies making 14 available. That, less the 14 cookies that I have and are eating, leaves 0 cookies in the cookie jar. And may I please be excused -- I think I am going to be sick.

And that is the Rule of 4...

(1) Quantity at the Beginning,

Plus

(2) Quantity Added,

Less

(3) Quantity Consumed,

Equals

(4) Quantity at the End.

Now, back to Reconciliation. When there are two different totals or counts of the same thing, which obviously must be the same, the matters that cause them to not be the same are called reconciling items, and indicates that something is wrong and needs to be corrected. When the reconciling items are corrected and the total or counts are in agreement, they will have been reconciled. Example - Let's say that we are in a cookie store and we have a list of three kinds of cookies for which we want to buy a half dozen (6) of each -- a total of 18 cookies. The store clerk had made his list of the cookies he put into the cookie bag which totaled 21. Alert! Something is wrong. We compared the lists and find the following… Your Clerks List List Oatmeal Raisin 6 cookies 6 cookies Peanut Butter 6 6 Chocolate Mint 6 6 Sugar - 3 Total 18 21 Reconciling item (Sugar) 3 _- 21 21 The clerk explained that because we were such good customers he had put an extra 3 sugar cookies free in the bag to eat on the way home. After thanking the clerk for the free cookie snack, they thanked him for helping to identify the 3 cookie reconciling item. By adding the free 3 to their list makes the totals agreed and reconciled. Another example may help in understanding this kind of problem. Let's assume that we have two sets of numbers that are supposed to be the same, but are not. Set 1 Set 2 1 1 2 2 3 3 4 5 10 11 Note that both sets are correctly added, but they are supposed to add to the same amount. What corrections do we need to make for the two lists to be reconciled? We quickly see that List 1 has a 4 and List 2 does not, and that List 2 has a 5 and List 1 does not. So there are two reconciling items which are needed to correct the lists for them to be the same. The corrected ands reconciled lists then appear as… Set 1 Set 2 1 1 2 2 3 3 4 4 _5 5 15 15 You ask, "How would I ever use this reconciliation idea"? That is a good question and it generally relates to quantities of something including money. Let's say you have a bank account like your parents do, maybe not now, but someday you will. You put your money (called making a deposit) into a banks' bank account along with a number the bank will give to you to uniquely identify you (an account number) so that the bank could identify and have a record of the amount of money you deposited, any withdrawals of money to pay (checks) money you owe to others, as well as the remaining amount of money that they are holding for you. This is how the movement of money generally takes place. So instead of having to run around with a bundle of cash to pay your bills (amounts you owe people), it is much more convenient to merely write a check to each of the people to whom you owe money, then let the US Postal service do the running around, and having the bank transfer the money to pay the amounts out of your account to the account of the person or entity being paid. Since it is your money in the bank account you need to keep a record of what goes into and out of your account and the balance available for your use - it is your money. This record is typically called a "check book". You should never write a check for more than what is in your account (the amount the bank is holding for you) as the banks really don't like it and will refuse to transfer the money that you requested by your check. They will also return your check to you as if it had never been prepared along with a notice that they are charging your account with a serious "Insufficient Funds" fee. So always maintain a positive balance in your account. To be safe rather than sorry, keep your check book up to date and reconcile your account promptly after getting your statement each month. Your record (check book) is in the form of the Rule of Four…(1)Beginning Balance, plus (2) the individual Deposits, less (3) the individual Checks Paid including any Service Charges or other items by the bank, equals (4) the Ending Balance. Interestingly, the bank has exactly the same Rule of Four record of your bank account as you have, as they need to know how much they owe you. Obviously your record and the banks record should be the same but the timing of transactions as between you, the entity getting paid, and the bank, can and does create temporary reconciling items. The bank sends you a monthly statement detailing the transactions for the month from their records expecting you and wanting you to check their records to yours and to reconcile these two sets of records. Bank Statement for Month of June… Beginning Balance at 6/1 (which was reconciled at 5/31) $ 560.00 (1) Deposits processed 6/14 $ 7,300.00 6/24 $ 1,000.00 6/29 $ 500.00 $ 8,800.00 (2) $ 9,360.00 Checks and Service Charges processed Check Number 5507 6/1 $ 150.00 5508 6/3 $ 280.00 5509 6/8 $ 200.00 5510 6/15 $ 660.00 $(1,290.00) (3) Bank Service Charge 6/30 $ (20.00) (3) Ending Balance (per bank) at 6/30 $ 8,050.00 (4) Your Check Book shows the following transactions for the same month… Beginning Balance at 6/1 (which was reconciled at 5/31) $ 410.00 (1) Deposits processed 6/14 $ 7,300.00 6/24 $ 1,000.00 6/29 $ 500.00 $ 8,800.00 (2) $ 9,210.00 Checks processed Check Number 5507 6/1 $ 150.00 5508 6/3 $ 280.00 5509 6/8 $ 200.00 5510 6/25 $ 660.00 5511 6/30 $ 250.00 $ (1,540.00) (3) Bank Service Charge _0 (3) Ending Balance (per Check Book) at 6/30 $ 7,670.00 (4) If the Bank and Check Book (CB) ending balances at 6/30 are the same (4) the account is already reconciled and there is nothing further to do. Typically, as in this illustration, they are not the same and the balances need to be reconciled. There are a number of methods to do a reconciliation the easiest of which is simple as 1,2,3,4. as is illustrated in the following. Check Reconciling Items Bank Book_ Timing Outstanding Adjust Statement 1 Beginning Balance $ 410.00 $ 150.00 $ 0 $ 0 $ 560.00 2 Deposits $ 8,800.00 $ 0 $ 0 $ 0 $8.800.00 3 Checks $ (1,540.00) $ 0 $ 250.00 $ 0 $(1,290.00) 3 Service Charges $ 0 $ 0 $ 0 $ (20.00) $ ( 20.00) 4 Ending Balance $ 7,670.00 $ 150.00 $ 250.00 $ (20.00) $ 8,050.00 Notations: " Line 1, Timing-Check No. 5507 was recorded in May and Outstanding at 5/31. It was processed by the bank on 6/1 and is a timing matter only. " Line 3, Outstanding-Check 5511 was issued in June and recorded by the Bank in July and outstanding at 6/30. " Line 3.SC-A June use of cash which should be promptly recorded in the Ck.Bk . Proof: Check Bank Book Statement Balances at 6/30 $ 7,670.00 $ 8,050.00 Line 1 Outstanding $ ( 150.00) Line 3 Pending $ ( 250.00) Line 3 SC $ 20.00 ________ Reconciled Balances 6/30 $ 7,650.00 $ 7,650.00 In addition to the use of the word "Reconcile" in matters of numbers, it is also used to describe people "reconciling" their differences with others. This involves understanding their differences and leading them, and yourself, into an enlightened self interest agreement, understanding, or acceptance of those differences. The technique of numbers - bringing numbers into agreement - should be useful in bringing people, and nations, into agreement. That is the great challenge to the youth of today as they become the leaders of tomorrow -- To enhance the potential for world peace.