...LESSON 14: CASH BOOK, PASS BOOK, BANK RECONCILIATION STATEMENT Dr. Jyotsna Sethi, Rekha Rani STRUCTURE 14.1 Introduction 14.2 Objectives 14.3 Cash Book 14.4 Types of Cash Book 14.4.1 Simple Cash Book 14.4.2 Two Column Cash Book 14.4.3 Three Column Cash Book 14.5 Petty Cash Book. 14.5.1. Imprest System of Petty Cash Book. 14.5.2 Advantages of Petty Cash Book 14.6 Pass Book 14.7. Bank Reconciliation Statement 14.7.1 Meaning 14.7.2. Causes for difference between Cash Book Balance and Pass Book Balance. 14.7.3. Need and importance of Bank Reconciliation Statement 14.7.4 Procedure for preparation of Bank Reconciliation Statement. 14.8. 14.9. Summary Glossary 14.10. Self Assessment Questions 14.11. Answer to check your progress 14.12. Further Readings 14.1. INTRODUCTION Every entrepreneur should have knowledge of cash book and pass book as from these books, he may check how much balance is available to him for meeting his expenses and liabilities and what are the details of receipts and payments of a particular period. With the details of payments it can be checked that whether the payments are of reasonable amount or not. If the expanses are unreasonably high he may take steps to control them. An 211 entrepreneur who regularly checks his cash and bank balances would never face problems like dishonor of cheques or cash crisis etc. Entrepreneur, who doesn’t distinguish between his revenue and profits, may spend all his receipts for his personal purposes subsequently...
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...Introduction to Bank Reconciliation A company's general ledger account Cash contains a record of the transactions (checks written, receipts from customers, etc.) that involve its checking account. The bank also creates a record of the company's checking account when it processes the company's checks, deposits, service charges, and other items. Soon after each month ends the bank usually mails a bank statement to the company. The bank statement lists the activity in the bank account during the recent month as well as the balance in the bank account. When the company receives its bank statement, the company should verify that the amounts on the bank statement are consistent or compatible with the amounts in the company's Cash account in its general ledger and vice versa. This process of confirming the amounts is referred to as reconciling the bank statement, bank statement reconciliation, bank reconciliation, or doing a "bank rec." The benefit of reconciling the bank statement is knowing that the amount of Cash reported by the company (company's books) is consistent with the amount of cash shown in the bank's records. Because most companies write hundreds of checks each month and make many deposits, reconciling the amounts on the company's books with the amounts on the bank statement can be time consuming. The process is complicated because some items appear in the company's Cash account in one month, but appear on the bank statement in a different month. For example, checks...
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...able to:Knowledge 1. Distinguish different forms of business and its reporting environment. 2. Explain the accounting principles and the role of accounting reports.Thinking Skills 3. Use accounting equation to analyse the economic effect of a transaction. 4. Use double entry system of accounting to record business transactions.Subject-based Practical Skills 5. Prepare trial balance. 6. Prepare adjusting entries and closing entries. 7. Prepare entry for special journals and subsidiary ledgers. 8. Prepare cash book and petty cash systems. 9. Value the stock using FIFO, LIFO and Weighted Average. 10. Prepare basic financial statements. 11. Prepare bank reconciliation. | 11. | Reading List: | Main Text:Andrew Thomas & Anne Marie Ward; Introduction to Financial Accounting (seventh edition, McGrawHill) 2011Additional Text :ACCA Study Text, F3 Financial...
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...REPORT ON THE INTERACTIVE SESSION OF FINANCE & ACCOUNTS DEPARTMENT, CORPORATE AFFAIRS COMMISSION Venue: KEFFI HEALTH CLUB, KEFFI. Date : 23rd January 2010 Climate setting for the program was tuned by the Deputy Director Final Accounts/Mrs.B.F.Ikhanoba. Samuel Archibong offered the opening prayers. The DD/FA introduced the Senior Executives present. The Acting DFA/Mr. M.U.Wambai delivered the opening remarks with a word that the aim of the forum is to develop human capacity. Declaring the interactive session open the DFA emphasized on participation by all present. • The first paper was presented by the Senior Manager, Final Accounts/ K.M.Jemaku. Titled: FIXED ASSET MANAGEMENT – OPERATION & CHALLENGES: It defined and classified fixed assets, their management, depreciation and disposal. The management of Fixed Assets was noted to be a huge challenge to Finance & Accounts Department because of the many lapses imminent. The Sun System Fixed Assets module captured most of the detail data identifying an asset, and provides information automatically. Each asset is then assigned a code to further give the required peculiarity in the database. The presenter identified the challenges as follows; - Time lag between coding and labeling of assets. - Difficulty in tracing assets to assigned locations. - Failure to code some assets making disposal difficult. - Inability to reconcile physical assets with the register. Other issues relating to management of Fixed...
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...years' experience in accounting and finance across multiple sectors, I am now looking to expand my career and apply my skills and expertise in an external audit role. Work Experience Palma Consulting ------------------------------------------------- Chief Accountant Apr 2014 – present * Responsible for all financial and accounting transactions and Reporting * Responsible for all banks transactions and relations * Responsible for all relations with government agencies (Sales Tax Department, Income Tax Department and Social Security Department) * Producing various management reports for the Consulting and Procurement departments, and to the CFO * Developed and documented accounting policies for the firm * Currently handling the introduction of an HR payroll system and the replacement of the Accounting system MEPS (MasterCard) ------------------------------------------------- Accounting Officer Mar 2013 – Mar 2014 * Reconciled and maintained over 20 bank accounts * Responsible for monthly closings and assisting with monthly and yearly financial statements * Responsible for monthly payroll systems * Reconciling and maintaining employees’ accounts and transaction follow up with HR ------------------------------------------------- Bell Amman (Luminos Group) Accountant ...
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...HS Accounting LLC Proposal for Going Public Prepared: Hector Serrano ACCT-504-63660 Accounting Financial Professor Jones Kasonso 4/4/2014 Table of Contents A. Introduction 1 B. New requirement on going public 1 C. What the company is doing right 2 D. What the company is doing wrong ……………………………………………...…. 3 E. Conclusion 3 F. Reference 5 A. Introduction Per request of the President of LJB Company HS Accounting Firm has reviewed the company’s existing internal control mechanisms and provided answers to the president’s questions. This report advises the President on new internal control requirements, what the company is doing well, and identify what they are doing wrong. Additionally, review the proposed purchase of an indelible ink machine by the company. Internal Controls is so critical that the U.S. Congress has passed a law, The Sarbanes-Oxley Act, to require public companies or those going public, to maintain a system of internal controls and to require that their auditors examine those controls and issue audit reports as to their reliability (Harrison, 2013). Internal control is important because it prevents fraud or unintentional errors by accomplishing the following five objectives; safe guarding assets, encouraging employees to follow company rules, promoting operational efficiency, ensuring accurate and reliable accounting and complying with legal requirements. We at HS Accounting LLC have provided the following answers to the president’s...
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...UGANDA CHRISTIAN UNIVERSITY MUKONO FACULTY OF BUSINESS AND ADMINISTRATION INTERNSHIP REPORT CONDUCTED AT MUKONO CENTRAL DIVISION. BY ODOI ABRAHAM OCHIENG ES11BO5/605 AN INTERNSHIP REPORT SUBMITTED TO THE FACULTY OF BUSINESS AND ADMINISTRATION IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE DEGREE OF BACHELOR OF BUSINESS ADMINISTRATION MARCH 2013 APPROVED BY MR. SSERWANGA EMMANUEL ES11B05/605 DECLARATION I Odoi Abraham Ochieng declare that this report is my original work and has not been submitted to any college, university or institution for any academic award. Sign……………………… Odoi Abraham Ochieng Date……………………… i ES11B05/605 APPROVAL I, the supervisor, have approved this report. It meets the Faculty’s requirement for the award of a Bachelor’s degree in Business Administration at Uganda Christian University. Signed:........................................... Sserwanga Emmanuel Date:…………………………………….. ii ES11B05/605 DEDICATION To my Lord and Savior who continually sustains me. To my family the foundation of my well-being. iii ES11B05/605 ACKNOWLEDGEMENT I take great delight in acknowledging the invaluable assistance rendered to me by all parties that contributed to my successful internship program. Many thanks go to the Division Treasurer MCD Mr. Sserwanga Emmanuel, as well as, Mr. Kyambade Ronald, who invested a great deal of time to share his knowledge and experience in Local Governance and made my training with MCD worthwhile...
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...Introduction Internal control methods and measures are adopted to safeguard assets, enhance accuracy and reliability of accounting records, increase efficiency of operations and ensure compliance with laws and regulations. Control environment. The management style and the expectations of upper‐level managers, particularly their control policies, determine the control environment. An effective control environment helps to ensure that established policies and procedures are followed. The control environment includes independent oversight provided by a board of directors and, in publicly held companies, by an audit committee; management's integrity, ethical values, and philosophy; a defined organizational structure with competent and trustworthy employees; and the assignment of authority and responsibility. Control activities are the specific policies and procedures management uses to achieve its objectives. The most important control activities involve segregation of duties, proper authorization of transactions and activities, adequate documents and records, physical control over assets and records, and independent checks on performance. A short description of each of these control activities appears below. • Segregation of duties requires that different individuals be assigned responsibility for different elements of related activities, particularly those involving authorization, custody, or recordkeeping. For example, the same person who is responsible for an asset's...
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...LJB Company Internal Controls Evaluation and Assessment CONTENTS: 1. Introduction and Scope ……………………….Page 1 2. Results and Findings……………………………Page 2 3. Recommendations………………………………Page 3 4. Reference Citations………………………….…Page 4 LJB COMPANY - Internal Controls Evaluation and Assessment Introduction and Scope: This evaluation looks at the current internal control system at LBJ Company, assesses for compliance with requirements for Initial Public Offering (IPO) and provides recommendations for strengthening the primary components of an effective Internal Control System. Internal Control System Primary Components 1. A control environment: It is the responsibility of top management to make it clear that the organization values integrity and that unethical activity will not be tolerated. 2. Risk assessment: Companies must identify and analyze the various factors that create risk for the business and must determine how to manage these risks. 3. Control activities: To reduce the occurrence of fraud, management must design policies and procedures to address the specific risks faced by the company. 4. Information and communication: The internal control system must capture and communicate all pertinent information both down and up the organization, as well as communicate information to appropriate external parties. 5. Monitoring: Internal control systems must be monitored periodically for their adequacy. Significant deficiencies need to be reported...
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...submitted for examination with my approval as the university supervisor Signed……………………………. Date…………………………………………. Mr. Abdulatif Essajee Lecturer University of Nairobi TABLE OF CONTENTS DECLARATION i CHAPTER ONE 1 INTRODUCTION 1 1.1 Background of the study 1 1.2 Statement of the problem 5 1.3 Objectives of the study 6 1.4 Research questions 6 1.5 Scope of the study 6 1.6 Justification of the study 7 CHAPTER TWO 9 LITERARURE REVIEW 9 2.1 Evolution of internal controls 9 2.2 Components of Internal Controls 12 2.4 Relationship between a firm’s age and internal control 18 2.6 Internal controls in small businesses 19 CHAPTER THREE 21 RESEARCH METHODOLOGY 21 3.1 Research design 21 3.2 Population 21 3.3 Sample and Sampling Technique 21 3.4 Data collection methods 22 3.5 Data analysis 22 CHAPTER FOUR 23 DATA ANALYSIS AND FINDINGS 23 4.1 Introduction 23 4.2 Segregation of Duties 23 4.3 Procedural Controls 24 4.4 Relationship between Age and Internal Control on Cash 25 CHAPTER FIVE 27 SUMMARY, CONCLUSIONS AND RECOMMENDATIONS 27 5.1 Summary of Findings 27 5.2 Conclusions 29 5.3 Recommendations 30 REFERENCES 31 Appendix 1: Internal Control Questionnaire for Cash 37 CHAPTER ONE INTRODUCTION 1.1 Background of the study...
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...Accounting Policies and Procedures Manual Xxx Accounting Policies and Procedures Manual Table of Contents Introduction Division of Duties Cash Receipts Procedures Cash Disbursements Procedures Reconciliations Petty Cash Fund Purchases Fixed Asset Management Payroll Financial Reporting Grant Compliance Fiscal Policy Statements Annual Meeting Checklist Computer System Backup Procedures 1 2 4 6 8 11 12 15 16 18 19 21 23 24 Introduction This manual has been prepared to document the internal accounting procedures for the Xxx (XXX). Its purpose is to ensure that assets are safeguarded, that financial statements are in conformity with generally accepted accounting principles, and that finances are managed with responsible stewardship. All personnel with a role in the management of XXX's fiscal operations are expected to uphold the policies in this manual. It is the intention of XXX that this accounting manual serve as our commitment to proper, accurate financial management and reporting. Revised 1/26/97 1 Division of Duties The following is a list of personnel who have responsibilities within the accounting department: President: 1. Reviews and approves all financial reports. 2. Reviews and approves annual budget. 3. Reviews the payroll summary for the correct payee, hours worked and check amount. 4. Reviews all vouchers and invoices for those checks which require his or her signature. 5. Reviews and approves all contracts for goods and services that...
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...The Internal control management strategies Prepared for: LJB Company Prepared by: Chibuzor E. Edeh Devry University ACCT 540: Financial Accounting TABLE OF CONTENT Introduction ----------------------------------------------------------------------------------------------------------3 Internal control regulations for public companies -----------------------------------------------------------3-4 LJB’S good internal control measures -------------------------------------------------------------------------4 Recommendations for Indelible ink --------------------------------------------------------------------------4 LJB’S poor internal control measures ------------------------------------------------------------------------5-6 Recommendations for improvement --------------------------------------------------------------------------5-6 Summary --------------------------------------------------------------------------------------------------------7 References ------------------------------------------------------------------------------------------------------- 7 INTRODUCTION Internal control consists of all the related methods and measures adopted within an organization to safeguard its assets, enhance the reliability of its accounting records, increase efficiency of operations, and ensure compliance with laws and regulations. Internal control is very important because it discourages employees from fraudulent activities...
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...Case Study 2—Internal Control ACCT 504 WK 5 Professor: Melinda Howerton Date: April 5, 2014 Table of Contents Introduction 3 New Internal Control Requirements 4 Internal Control Strengths 4 Internal Control Weakness 5-6 Recommendations and Conclusion 6-7 Works Cited 8 Introduction This report is being presented as an assessment of the preparedness of the LJB Company to go public, and must first understand what and why successful internal controls are necessary. Internal control is a plan of organization and a system of procedures implemented by company management and the board of directors designed to accomplish the following five objectives: Safeguard assets- A company must safeguard its assets against waste, inefficiency, and fraud. Encourage employees to follow company policy- Everyone in an organization—managers and employees—needs to work toward the same goals. A proper system of controls provides clear policies that result in fair treatment of both customers and employees. Promote operational efficiency- Companies cannot afford to waste resources. They work hard to make a sale, and they don’t want to waste any of the benefits. Ensure accurate, reliable accounting records-Accurate records are essential...
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...The Arab – Israeli Conflict: Peace Building Learning Institution Student Name Introduction The Arab-Israeli conflict is not a single conflict especially when analyzing and evaluating movements towards new forms of behavior in a given conflict system (Bar-Siman-Tov, 2013: 1). The United States played in a key role in the encouragement of a creation of a conflict management framework that could be applied. It was realized that there would be a need for a further and deeper learning process to enable conflict resolution (Bar-Siman-Tov, 2013: 1). As an intrastate conflict, the Palestinian-Israeli conflict should be seen above all as a major human problem involving approximately 3 million people who have been systematically deprived of their individual freedoms and right of self-determination through nearly three decades of military occupation (Kaufman, 2012: par 5). The decision to form a truth and reconciliation commission can drastically affect the future of a society recovering from a traumatic past (Coleman, 2013: par 7). He specific conditions of the nation, culture and peoples involved must be considered carefully before deciding to form a truth and reconciliation commission (Coleman, 2013: par 3). Societies emerging from violent conflict or oppressive regime often find it difficult t recover, build a future, and prevent themselves from falling into the conflict trap (Committee, 2011: par 4).The core pillars of transitional justice are truth seeking...
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...PRINCIPLES OF ACCOUNTING Higher 2 (2016) (Syllabus 9755) CONTENTS Page INTRODUCTION 2 AIMS 2 ASSESSMENT OBJECTIVES 2 SPECIFICATION GRID 2 SCHEME OF ASSESSMENT 3 SYLLABUS OUTLINE 3 SYLLABUS CONTENT 5 SUMMARY OF COMMONLY USED RATIOS 15 RESOURCES 16 Singapore Examinations and Assessment Board MOE & UCLES 2014 1 9755 H2 PRINCIPLES OF ACCOUNTING (2016) INTRODUCTION Principles of Accounting aims to provide candidates with a foundation course in accounting at a breadth and depth appropriate to the A Level. It is designed to provide candidates with a sound understanding of financial and managerial accounting procedures and an appreciation of its role in society. The teaching approach emphasises the broad educational aspects of the subject rather than one which is vocational or professional in nature. There is no requirement to learn the published accounting standards. Prior knowledge is not necessary for students offering this syllabus. It is not the intent of this syllabus to be a pre-requisite for any business-related courses. AIMS 1. Develop an understanding of the concepts, principles and practices of accounting and the ability to apply them in a variety of business and personal situations; 2. Develop an understanding of the role of accounting as an information system for monitoring, problemsolving and decision-making in changing economic, social and technological environments; 3. Develop a critical approach to analysing and evaluating accounting policies...
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