CHAPTER 16 Flashcards
Controls over Transactions
Internal check/control
Concerned with the maintenance of accounting records / Ensure that transactions to be recorded and processed are authorised, correctly recorded and accurately processed
Types of internal check
- Accounting software
- Bank reconciliations
- Supplier account reconciliations
- Segregation of duties
- Authorisation
Contra entries
▪ Offset balance owed by each other
Dr TP
Cr TR
** Chose lower amounts !!
Period end routines
- Bank reconciliations
- Supplier reconciliation
- Sales tax return
- Trial balance
For putting the financial statements of the entity
Bad Debt Recovered Entry
Dr Bank
Cr IRD Expense
Allowance for Receivable Entry
Increasing:
Dr IRD
Cr AFR
Decreasing :
Dr AFR
Cr IRD
Allowance for Receivable Entry
Increasing:
Dr IRD
Cr AFR
Decreasing :
Dr AFR
Cr IRD
Net Trade Receivable
= TR - IRD - Closing AFR
Opening CREDIT balance in TR????!!!
- Business owes money to customer
- Due to overpayment
- Payment in advance for debts which no invoice have yet been sent
b/f as separate credit balance and NOT NETTED OFF against debit balance
Which personnel handle petty cash ?
Payable ledger controller / Assistant accountant
When will payable ledger controller prepare cheques for payment ?
- There is a purchase order for the goods
- Correct goods were received
- Received in good condition
- Invoice is correct
** although they prepare it, the one signing it is accountant
