ACC 113 Lecture Notes - Lecture 26: Bank Reconciliation, Cash Cash, Bank Statement

• School: Tunxis Community College
• Department: Accounting
• Course: ACC 113
• Professor: Muccino

Document Summary

Transferred easily from one person to another (liquid) Cannot be specifically identified as belonging to one particular person (anonymous) Therefore most susceptible to theft, misappropriation or fraud. Common control is locked in sales registered or carefully controlled records. Another way is to have multi copied, pre numbered sales invoices check cash sales, cash received, credit sales, accounts receivable, inventory. There should also be someone overseeing the whole process of cash control. Cheques should be signed by 2 staff members who are independent of invoice approval and accounting duties. All cash receipts banked in entirety daily. The purpose of the bank reconciliation statement is to explain any differences between the bank balance at the end of the period as shown in the bank statement and in the firm"s ledger, respectively. Any errors discovered may be rectified before completing the journals and postings for the period.