BUS 426 Lecture Notes - Lecture 6: Cash Cash, General Ledger, Cheque

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 426
• Professor: Michael Favere- Marchesi

Document Summary

Recording liability for purchased goods (invoice) Occurrence: recorded acquisitions are for goods received: invoices receiving report purchase order. Completeness: existing acquisitions have been recorded: purchase order receiving report invoices, primary objective, because it can overstate a/p. Timing: acquisition transactions are recorded on correct dates. Posting and summarization: acquisition transactions are properly included in the vendor master file (posted to right vendor account), and properly summarized in the general ledger (correct total appears in general ledger) Usually use attribute sampling for test of controls. Relatively low tolerable exception rate because of the number (too large) of accounts affected. Occurrence: recorded cash disbursements are for goods received: cheque receiving report, primary objective, because it can understate a/p (liability) Accuracy: recorded cash disbursement are accurate: cheque invoice. Timing: cash disbursements are recorded on the correct dates. Posting and summarization: cash disbursement transactions are properly included in vendor master file and properly summarized in the general ledger.