Cash and Bank cycle

Question 1

Cash receipts:

Answer 1

1. Cash Register
   Start of shift
   Receipt
   Cash payment slip
   Direct deposit
   Daily cash-up recon
   Cash count
   Bank recon
   End of shift
2. Debt card/ Credit card
   Receipt
   Debt/ Credit card slip
   Direct Deposit
   Daily cash-up recon
   Bank recon
3. EFT
   Bank recon
4. Direct deposit
   Bank recon

Question 2

Risk: Cash receipts

Answer 2

Receive money: Initiate
Theft of receipts (Validity)
Receive incorrect amount (Accuracy)

Deposit receipts: Execute
All cash received is not banked (Completeness)

Recording:
Recorded receipts never occurred (Validity)
Amounts are recorded incorrectly (Accuracy)
Amounts are recorded in the incorrect period (Completeness)

Process
All receipts are not recorded (Completeness)

Question 3

Cash Payments

Answer 3

1. EFT
   Payment schedule invoice
   payment requisition
   Daily cash-up recon
   Bank recon
2. Direct Deposit
   Bank recon
3. Petty Cash
   Petty cash slip
   Petty cash recon
   Petty cash count

Question 4

Control Objectives: Receipts

Answer 4

To ensure that…
1. All receipts are adequately safeguarded. (V)
2. All receipts are correctly calculated. (A)
3. All receipts are banked. (C)
4. All receipts are supported by underlying documents as evidence of actually occurring. (V)
5. All receipts are recorded at the correct amount actually received. (A)
6. All receipts of cash are recorded timely in the correct accounting period. (C)
7. All receipts are recorded in the accounting records and no receipts are
misappropriated or omitted. (C)

Question 5

Risk: Payments

Answer 5

Making payments:
Payments not in terms of policy (V)
Payments to fictitious supplier (V)
Pay more than once (V)
Pay incorrect amount (A)
No payments made at all (C)

Recording:
Payment did not occur (V)
Incorrect classification on recording (A)
Incorrect recording (A)
Payments not recorded at all (C)
Payment not recorded in the same period (C)

Question 6

Payments: Control Objectives

Answer 6

To ensure that
1. Payments are approved in terms of the correct payment policy
2. Payments are made to the correct suppliers
3. Payments are calculated correctly
4. Payments are for transactions that actually occurred, and goods and services were received.
5. Payments are classified in the correct accounts in the financial records.
6. All payments are recorded in the accounting records.