Cash and Cash Equivalent Flashcards
Measurement of
Cash in local currency
Cash in foreign currency
Cash in closed banks or in bankruptcy
Face Value
Face Value
Etimated realizable value
Compensating Balance is ______ if silent
Unrestricted/informal
Money order part of Cash? Classification if any.
Yes
Bank drafts part of Cash?
Classification if any.
Yes.
a negotiable instrument where payment is guaranteed by the issuing bank.
Escrow deposit part of Cash?
Classification if any.
No. Long term investment
Time Deposit part of Cash?
No. Short Term Investment
Restricted Compensating Balance part of Cash?
Classification if any.
If more than 12 mos - Longterm Investemtment
12 mos or less - Short Term Investment
Bank overdraft part of Cash?
Classification if any.
No. Current Liability
Cash fund for asset acquisition part of cash?
Current Asset. Yes
NCA. Longterm Investment. Regardless of when is disbursement
Cash fund for use in operations part of Cash?
Classification if any.
Yes.
Cash fund for settlement of Liabilities part of cash?
Classification if any.
Current Liability. Yes
NCL. No. Long Term Investment
2 types of Petty Cash Fund
Imprest - common
Fluctuating - continues recording
Fradulent Activities in Cash
Lapping
Window dressing
Kiting
Cash Equivalent
General Rule
ONLY debt instruments acquired within 3 months or less before their maturiy date can qualify as cash equivalents
Can Equity Securites qualify as Cash Equivalents?
No since the do not have maturity date.
EXCEPT redeemable preference shares (w/ mandatory redemption) that are acquired 3 months before their redemption date
