Clearing and settlement reconciliation is the fuller name for settlement reconciliation, which covers the process, data sources and typical breaks in detail. The longer phrase names both stages being compared, which helps in card and scheme environments where clearing and settlement are separate events.
In card payments, clearing is the exchange of final transaction details between acquirers and issuers through the network, usually in daily clearing files. Settlement is the actual movement of money, normally as a single net amount per day between each member bank and the network's settlement bank. Clearing and settlement reconciliation checks that the total of all cleared transactions, minus interchange, scheme fees and adjustments, equals the cash that arrived. A second step then matches the acquirer's payouts against each merchant's expected funding.
Breaks can come from late presentments, currency conversion, chargebacks, reversals or simple file errors. Operations teams investigate each one, and unresolved differences sit in suspense accounts until cleared. The same idea applies to other rails, such as checking an ACH file against settlement on the central bank account. It forms part of wider payment reconciliation.