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POA, Bank Reconcilation Flowchart, . - Coggle Diagram

- - - - Cash At Bank
      - Cash In Hand
      - Business SOLD (-)
      - Business BOUGHT (+) (Inventory)
    - - Cost Of Sales
      - Refreshments...
      - __ expense
      - Discount ALLOWED
    - - Owner TOOK $x worth
    - - Business OWES
      - Business BOUGHT ON CREDIT
    - - Business EARNED/SOLD
      - Discount RECEIVED
    - - Owner CONTRIBUTED
  - - - Keywords: Contributed
    - - Keywords: Withdrew
- - - - Dishonored Cheques
        
        Reasons why it is rejected
        
        The amount in figures and in words do NOT TALLY
        
        There is NO Date, Signature, or amount
        
        The payer's bank account does not have enough FUNDS, CLOSED, or FROZEN
        
        Cheque is EXPIRED
        
        The cheque is POST-DATED
        
        Originally, Cash At Bank increase and Trade Receivables from customer decrease, due to customer paying by cheque
        
        Since Dishonored,
        
        Accounts will reverse. Cash At Bank Decreases, and Trade Receivables from customer increases
      - Basically always Cash At Bank
    - - Purpose
        
        To explain the difference between the balance in the cash at bank account and the balance in the bank statement;
        
        To check for errors in the cash at bank account and the bank statement
        
        To calculate the accurate cash at bank balance.
        
        To deter the occurrence of FRAUD
      - Why do timing differences occur?
        
        the business has already recorded the transaction but the bank has not;
        
        Cheques not yet presented
        
        The business has issued a cheque to its supplier but the supplier has not presented the cheque to the bank for payment yet.
        
        Deposits in transit
        
        The business has deposited the cheque with the bank but the bank has not processed the cheque yet.
        
        the business has not recorded the transaction but the bank has already recorded it.
        
        Direct Transfer
        
        The Customer deposits cash or cheques with the bank directly or transfers funds directly into the business bank account through a credit transfer
        
        Direct Payments
        
        The bank has been authorised by the business via a standing order to pay and transfer funds directly into its suppliers' bank account.
        
        Dishonored cheques
        
        Bank rejects a cheque that a company has recently deposited.
      - Answering technique
        
        Check opening balances.
        
        If equal, go to Step 2.
        
        .
        
        Step 2b: Compare the items in the debit column of the cash at bank account and the deposit column of the bank statement. Identify the differences.
        
        1 more item...
        
        Step 2a: Compare the items in the Credit column of the cash at bank account and the withdrawal column of the bank statement. Identify the differences.
        
        Different? Find same balance in Cash at bank and Bank statement, and make that your starting position of both accounts.
        
        None? Check the bank has subsequently recorded the item that caused the difference within the same month. Exclude these from subsequent equations in Step 2.
        
        Keywords
        
        Bank Reconciliation as of _ __ 20xx
        
        Bank Reconciliation
        
        At start of bank reconciliation add 'credit/debit
        balance as per bank statement'
        
        In the middle
        
        Add: Deposits in transit (for + changes)
        
        Less: Cheques not yet presented (for - changes))
      - Important Info: Debit in CAB account is equal to Credit in Bank Statement and Bank Reconcilation
  - - - NOT recorded in ledger account
    - - Recorded in ledger
        
        Under 'Discount Allowed'
- - - - Sales Revenue
        
        Less: Sales Returns (-ve)
        
        Net Sales Revenues
        
        Cost of sales
        
        Gross Profit
        
        Add: Other Income (title)
        
        1 more item...
    - - Main Heading: Assets
        
        Current Assets
        
        Non-current Assets
        
        Total Assets
        
        Equity And Liabilities
        
        Owner's Equity
        
        1 more item...
    - - List everything down
        
        Put all values into respective debit/credit columns using AED/LIC
        
        Total Debit/Credit columns
        
        Check if both equal
- - - - .
  - - - Are the opening balances the same?
        
        No
        
        Is there another balance further down that matches?
        
        No
        
        Take the difference between the opening balance of the CAB and Bank Statement. Look for the amount that matches it from the Bank Statement entries. EXCLUDE it from comparison.
        
        1 more item...
        
        Yes
        
        Draw a line below the same balance
        
        Yes
        
        Compare the DEBITS from CAB with the DEPOSITS in the BANK STATEMENT, Compare the CREDITS from CAB with the WITHDRAWALS in the BANK STATEMENT
        
        . Strike out the numbers that match
        
        Circle or box the entries that differ.
        
        1 more item...