Bank Reconciliation Flashcards
Why do you need bank reconciliation?
Prove that entries in CAB ledger = bank statement
ensure that all cash transactions are recorded, no entry left out
to determine the true balance that should be in the bank
What are the types of direct charges to the bank statement
giro payment for bills dishonoured cheques cheque book fees administration fee govt tax on debits
Direct charges should be adjusted to
CPJ
What are the types of direct credits to the bank statement
interest earned (on govt. bonds) remittances from debtors
Direct credits should be adjusted to
CRJ
Bank errors should be adjusted by the
bank
What things are not shown in the bank statement’s debit column but in the CPJ
unpresented cheques
What things are not shown in the bank statement’s credit column but in the CRJ
deposits not yet credited
outstanding deposits
Why are there errors in bank reconciliation
human error
accidental
deliberate
A deliberate error is used to
cover fraud
cash is misappropriated
An accidental error can arise from
transposing of numbers
entering a completely wrong number
Why is a cheque missing?
It is cancelled
When a cheque is cancelled, what should be done?
the auditor should inspect
