What is true up?

A true-up is a final reconciliation process done at the end of a specified period to ensure that the actual financial or operational results match the projected or expected results. This process is commonly used in accounting and finance to correct any discrepancies or errors that may have occurred during the reporting period.

True-ups are important for ensuring the accuracy of financial statements and other business reports, as well as for identifying any variances or deviations from the original projections. They may involve adjustments to revenue, expenses, assets, liabilities, or other financial metrics to align with the actual figures.

True-ups are often conducted on a quarterly or annual basis, but they can also be done more frequently if needed. The goal of a true-up is to provide a clear and accurate picture of the organization's financial performance and to help stakeholders make informed decisions based on reliable data.