Reversals and Refunds can, often times, be very similar in that they're both negative cash and negative net worth transactions. However, there is a basic difference between the two and it depends on context of the situation.
From a basic conceptual level:
a) A Reversed Monetary Contribution is essentially saying "the Monetary Contribution didn't really happen." For example, consider a bounced check. The check was deposited, but the bank rejected it and the committee never actually received the money.
b) A Refund is saying, "the Monetary Contribution happened but we took action to undo it." For example, the contribution exceeded limits so a refund check was sent back to the donor.
Another general rule to keep in mind: If the payment in question was deposited into the account, it would be a refund. If it was not deposited, it would be a reversal.
With regards to Compliance, we generally will show the Reversal Monetary Contributions on the Monetary Contribution schedule as a negative and the Refund with expenses. However, this will vary per agency. Some have specific schedules for either or both of these.