Auditing Cash and Bank Balances

Top Auditing Cash and Bank BalancesAudit techniques that are most relevant in testing the bank balance at December 31, 2xxx is by way of confirmation or reconciliation of Bank and the Bank.If there is a difference, then only two possibilities: 1. one transaction record, or 2) there is a good record of transactions unheard transaction receipts and cash disbursements (eg due to deposits in transit or expenditure but not yet disbursed by check or checks who are still in circulation).Audit techniques that are most relevant in testing the cash balance at December 31, 2xxx is by physical examination.1. Physical examination performed at December 31, 2xxx or when closing the books, apply if the assignment of the audit is started before the balance sheet date.2. Physical examination performed after the closing date (ie the balance sheet date of 31 Dec 2008), applies if the audit began in January 2009. Physical calculations can be performed on that date 31 Jan'09 2009. The results of a physical count of date January 31, 2009 plus expenses from January 1 till January 31, 2009 net cash proceeds from the date January 1 till January 31, 2009 compared to the cash balance per December 31, 2008 who served in the financial statements Balance Sheet.3. If there is a difference, then only two possibilities: 1. one transaction record, or 2) there is a good record of transactions unheard transaction receipts and cash disbursements.CASE EXAMPLE OF CALCULATION PHYSICAL:Eg The audited Financial Statements for the year 2008, a date the assignment began in February 2009. Physical Examination Schedule of Cash In Treasury conducted January 6 February 2009 (usually done after the Treasury closed the book on that day). Step-by-step examination:1. Calculate the cash that existed at that date and the amount of money and the units are grouped based on shards of metal or paper. Compare with a record of cash (cash book BESA) on that date.2. Add up the physical count of cash with mutations cash receipts minus cash expenses January 1 to 6 February 2009. The result should be similar to the existing cash in the balance sheet.3. If there is a difference, do the examination of cash receipts and expenditure from 1 January to 6 February 2009 to find out the cause ..Example: Calculation of physical dated February 6, 2009 Rp. 2.5 million (same as in the general ledger on TSB),Cash Receipts: 1 Jan to 6 February 2009 amounting to Rp. 6jutaCash expenditures: 1 Jan to 6 February 2009 of Rp.8jutaMeans Cash at 31 December 2008 should have amounted to Rp. 2.5 million +8 million - 6juta = Rp.4, 5 million, if there is a difference in cash per the balance sheet date to do the examination of evidence on the acceptance and expenditure up to date physical examination to look for the cause: 1) one note (less / more notes), 2) has not been noted, 3) missing. What if found fake money? Physical cash then calculated for the original money alone.CASE EXAMPLE OF BANK RECONCILIATION:Current Account Balance at Bank Mandiri according to company records 31 Dec 2008: Rp. 10.5 million, while according to the bank statement Rp.11.850.000 Mandiri. Upper case matching of records between general ledger and bank statement in December 2008. For example after ditelesuri, it turns out the company has not recorded a receivable for the repayment of Rp1, 1 million from customers in December (there is evidence on the Moon in December 2009), Adm. Cost for 50,000 banks and giro services revenue of Rp. 300,000.INDEPENDENT BANK RECONCILIATION OF DECEMBER 31, 2008:Balance according to company records Rp. 10,500,000, -Plus: Repayment of Receivable Rp. 1,100,000, -Current accounts of Rp. 300 000Less: Cost of Adm & Tax (Rp 50.000, -)The correct balance of Rp. 11.85 millionBalance according to newspaper accounts of Rp. 11.85 millionAdjustment journal entry:(D) Cash Bank Mandiri Rp.1.350.000(D) Expenses & Tax Adm. Rp. 50,000(C) Income USD current accounts. 300 000(K) Accounts Receivable Rp. 1.1 million5 Responses to "Top Audit Cash and Bank Balances"1.risal saidSeptember 1, 2010 at 2:05 amThere are several articles about the father who I want to ask. I calculate the physical balance but the difference was 1.5 million but the cash drawer already physically fit together, I examine the expenditures and receipts mutations already fit, but really there is a difference remains to track it down to the evidence that 1.5 million missing or wrongly recorded or not recorded at nah skali to prove anything to the auditees that there is one process bener overlooked culprit of one of the risk it (I did not find evidence of the difference 1.5 jt. I send cash count backwards as reference material from my question please help. Thank YouReply2.risal saidSeptember 1, 2010 at 2:12 amThere are emails that can be reached not pack, I want to send an attachment on my question above in the form of cash count backwards as references the father?Reply3.risal saidSeptember 1, 2010 at 5:12 amCan be shown the physical cash balance referral sources dated today slama this month + expenses - Receipts slama this month should be the same result with a cash balance lalu.tapi month I really the difference between y and physical y sm pack cash drawer large cash expenditures already equal trus ama acceptance jg sm on any balance sheet so there is no difference. Nil audit evidence may not be thrown as a difference of 1.5 jt findings nail on the head for no reason've seen smua the appropriate procedural right.Replyohuseinku saidOctober 17th, 2010 at 6:07 amThis technique is commonly used by the inspectors. Biasanyan used to perform calculations of cash back or forward.If the application of this technique is still there is a difference, I think there are some important points which need we look back:a. Is a physical count of cash balances together with cash on the day's notes (note balances end cash balance)? The requirement should be the same calculation technique first new cash back on top can be resumed. If not the same, meaning that the error comes from the prior period transactions.b. Whether mutation of cash (expenditure and revenue over the period) was recorded complete and is accompanied by evidence complete? condition ntara record cash mutation mutations that period with evidence of cash on a new period must equal the above techniques used reliably.If both are already done with these requirements and still there is difference, cause in my opinion:1. Derived from an error in recording cash prior period ending balance of cash which we will audit (inborn errors).2. To overcome these problems at point 1, there are several solutions interchangeable we do:We can use the audited cash balance (external auditors) as a guide fordetermine tracing backward or not. cash balance of the months that have been valid.