chap 13//13.4

Question 1

lapping

Answer 1

1.fraudulent act by employees who alters financial records to hide cash stolen by covering by applying subsequent cash receipts

2. occurs when there is a lack of segregation of duties of those receiving cash from customers and those recording the cash collection

Question 2

adt prdrs for lapping

Answer 2

1 surprise cash count: Include coin, currency, and customer cheques and compare deposit details with JE and customer acc.

2. compare details of JE and details of deposit slips to identify any discrepancies
3. send confirmation to TR at interim date to prevent any concealing adjustment

Question 3

adting for imprest cash fund

Answer 3

1. balance is rarely material
2. has to be requested by client
3. test of trans and balances are performed
4. a number of replenshing trsn tests performed

Question 4

adding for impress bank acc

Answer 4

1. used for payroll and dividend
2. confirm balance with bank when reviewing bank recon and subsequent period bank statement
3. only reconciling items on the bank statement will be unpresented payroll or dividend cheques
4. large entities employ independent share registrar to whom the total dividend amt is given. share registrar has to distribute the dividend accordingly and maintain records