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I am JOLINA M. DELA CRUZ
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PROOF OF
CASH
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PROOF OF CASH
A proof of cash is an expanded
reconciliation in that it includes
proof of receipts and disbursements.
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BEG. CASH
BALANCE XX
ADD:
RECEIPTS XX
LESS:
DISBURSEMENTS XX
ENDING
BALANCE XX
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FORMS OF POC
• ADJUSTED BALANCE METHOD
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ALL AMOUNTS
ALL RECORDED
THAT WERE PAID
CASH RECEIPTS
BY THE BANK
WERE DEPOSITED.
WERE RECORDED.
CASH IN BANK XX XX XX XX
ACOUNT BALANCES BOOK
NOTE COLLECTED DEBITS
XX (XX) BOOK
JANUARY XX XX
FEBRUARY
CREDITS
NSF CHECK
(XX) (XX)
JANUARY XX (XX)
FEBRUARY
ADJUSTED
ADJUSTED BOOK
BALANCE
XX XX XX xx
BOOK
BANK STATEMENT XX XX XX XX
BALANCE
BALANCE
BANK
DIT
SHOULD BE
JANUARY CREDITS
XX (XX) BANK
EQUAL FEBRUARY
TO XX XX
DEBITS
ADJUSTED
OC
(XX) (XX)
JANUARY
BANK FEBRUARY
XX (XX)
BALANCE
ADJUSTED BANK XX XX XX XX
BALANCE
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ILLUSTRATION 1: ADJUSTED BALANCE METHOD
SEPT. 30 OCT. 31
BOOK BALANCE BOOK 1.9M ?
TOTAL CASH RECEIPTS PER BOOK BOOK 1.4M
TOTAL CASH DISBURSEMENT PER BOOK BOOK 2.4M
BANK BALANCE BANK 2.1M ?
TOTAL CHARGES PER BANK STATEMENT BANK 2.5M
TOTAL CREDITS PER BANK STATEMENT BANK 1.2M
NSF CHECKS BOOK 60K 40K
COLLECTIONS OF A/R NOT RECORDED BY ENTITY
30K 50K
(CORRECTED BY SUBSEQUENT MONTH) BOOK
OVERSTATED OF CHECK IN PAYMENT OF SALARIES
BOOK 90K 120K
(CORRECTED BY SUBSEQUENT MONTH)
DEPOSIT IN TRANSIT BANK 120K 260K
OUTSTANDING CHECKS BANK 270K 30K 11
CASH CASH
BOOK SEPT. 30 OCT. 31
ASSUMPTION: RECONCILINGRECEIPTS
ITEM OFDISBURSEMENT
CURRENT MONTH
ASSUMPTION:
BAL. PER BOOK RECONCILING
WILL BE RECORDED
1.9M ITEM
NEXT OF CURRENT
MONTH.
COLLECTION
CASH MONTH
RECEIPTS OFWILL BE RECORDED
A/R NOT RECORDED:
1.4M NEXT MONTH.
CASH OVERSTATEMENT
SEPTEMBER, 30K
DISBURSEMENT OF SALARIES PAID: 2.4M
SEPTEMBER, 90K
UNADJ. BALANCE 900K
OCTOBER
ADD: CREDIT MEMO:OCTOBER = = CASHCASH90K(DR) RECEIPTS
30K (DR) RECEIPTS
A/R NOT RECORDED
SEPT. 30K
SALARIES
A/R (30K)
EXP
30K 90K
OCT. OCTOBER, 120K 50K 50K
LESS: NSF OCTOBER,
CHEK NOVEMBER
50K = CASH 120K (DR) (60K)
RECEIPTS
SEPT. (60K)
OCT. NOVEMBER = SALARIES
CASH 50K EXP
(DR) 120K (40K)
40K RECEIPTS
ERRORS: A/R 50K
SEPT. 90K (90K)
OCT. (120K) 120K
ADJ. BALANCE PER BOOK 1,960,000 1,330,000 2,260,000 1,030,00012
CASH CASH
BANK SEPT. 30 OCT. 31
RECEIPTS DISBURSEMENT
BAL. PER BANK 1.9M
TOTAL CREDITS 1.2M
TOTAL CHARGES 2.5M
UNADJ. BALANCE 800K
ADD: DEPOSIT IN TRANSIT
SEPT. 130K (130K)
OCT. 260K 260K
LESS: OUTSTANDING
CECKS (270K) (270)
SEPT. 30K (30K)
OCT.
ADJ. BALANCE PER BOOK 1,960,000 1,330,000 2,260,000 1,030,000
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ILLUSTRATION 2: UNADJ. TO ADJ. BALANCES
The cash account of KOTAKOTO COMPANY shows the following
activities:
Date Debit Credit Balance
Nov.30 Balance 115,000
Dec. 2 Nov. Bank Charges 50 114,950
4 Nov. Bank Credit for notes 10,000 124,950
receivable collected
15 NSF Check 1,300 123,650
20 Loan Proceeds 48,500 172,150
21 De. Bank Charges 60 172,090
31 Cash receipts book 707,300 879,390
Cash disbursements book 408,000 471,390
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CASH BOOKS 16 310-350 8,000 812 16,000
DA OR # AMOUN CHECK AMOUN 17 351-390 19,000 813 20,000
TE T # T
18 391-420 9,000 814 22,000
D. 1 110-120 11,000 801 2,000
19 421-480 17,000 816 36,000
2 121-136 21,300 802 3,000
22 481-500 21,000 817 11,000
3 137-150 20,000 803 1,000
23 501-525 32,000 818 50,000
4 151-165 56,000 804 3,000
23 - - 819 7,000
5 166-190 39,000 805 12,000
23 - - 820 4,000
8 191-210 66,000 806 19,000
26 526-555 74,000 821 3,000
9 211-232 88,000 807 26,000
28 556-611 5,000 822 12,000
10 233-250 77,000 808 30,000
28 - - 823 13,000
11 251-275 21,000 809 61,000 29 612-630 38,000 824 29,000
12 276-300 30,000 810 7,000 29 - - 825 2,000
15 301-309 55,000 811 8,000 29 - - 826 11,000
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16 809 61,000 85,000
BANK STATEMENT
17 DM 61 60 8,000
DATE CHECK CHARGES CREDITS
# 18 813 20,000 19,000
D. 1 792 2,500 8,500 19 CM 20 - 48,500
2 802 3,000 11,000 22 815 6,000 -
3 - - 21,300 23 816 36,000 47,000
4 804 3,000 20,000 23 811 8,000 -
5 EC 81,000 81,000 23 801 2,000 -
8 805 12,000 95,000 26 814 22,000 32,000
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SOLUTION:
OUTSTANDING CHECKS
A. CHECK # NOVEMBER 30 CHECK # DECEMBER 31
792 2,500 806 19,000
799 7,050 807 26,000
TOTAL 9,550 810 7,000
812 16,000
817 11,000
819 7,000
822 12,000
823 13,000
824 29,000
825 2,000
826 11,000
TOTAL 153,000
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SOLUTION:
B. DEPOSIT IN TRANSIT, NOVEMBER 30 8,500
DEPOSIT IN TRANSIT , NOV. 30 8,500
ADD: COLLECTION PER CASH RECEIPTS 707,300
TOTAL 715,800
LESS: DEPOSIT CREDITED BY BANK:
BANK RECEIPTS 831,300
CORRECTION OF BANK ERROR IN DECEMBER (81,000)
CORRECTION OF BANK ERROR IN (12,000)
NOVEMBER
LOAN PROCEEDS (48,500)
NOTE COLLECTED (12,000) 677,800
DEPOSIT IN TRANSIT, DECEMBER 31 38,000 20
KOTAKOTO COMPANY
PROOF OF CASH
FOR THE MONTH OF DECEMBER
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TRACING BANK TRANSFERS
PROCEDURES TO DETECT KITING:
• OBTAIN A BANK CUTOFF STATEMENT
DIRECTLY FROM THE BANK.
• PREPARE A SHEDULE OF BANK
TRANSFERS.
• TRACE ALL CHECKS, DEPOSITS AND OTHER CASH
CHANGES FROM THE CUTOFF STATEMENT TO CASH
RECEIPTS AND DISBURSEMENTS RECORDS, PAYING
PARTICULAR ATTENTION TO DATES AND
AMOUNTS.
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THANK YOU
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