22107 Chapter Notes - Chapter 5: Non-Sufficient Funds, Bank Reconciliation, Internal Control
Document Summary
Internal control - the system of policies and procedures that a company puts in place to provide reasonable assurance that: The company"s operations are effective and ef cient. The company is complying with applicable laws and regulations. Internal control systems are limited in their effectiveness because of the human element, and cost- bene t analysis. Bank reconciliation: reconcile the bank balance to the actual balance, reconcile the company"s book balance to the actual cash balance, adjust the company"s book balance to the actual cash balance. Petty cash fund - an amount of cash kept on hand to pay for minor expenditures, operation involving: Payments from petty cash do not require a journal entry, but an entry is recorded when the fund is replenished. Readily convertible into a known amount of cash. Has original maturity of three months or less (csl says six months or less)
