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Sir, yes there are other substantive procedures to bank and cash balance essentially to obtain sufficient and appropriate evidence.
Kaplan drafted like this;
agree balance per cash book on the reconciliation to the year end cash book and the financial statement to confirm accuracy.
My query the cash book balance on the reconciliation is it a separate document from the year cash book ? Because i know that cash book has two sides cash receipt and cash payment (GL) which is from the FS at period end. The reconciliation cash book is separately different from the cash book year end?
Thank you sir.
Yes – a reconciliation is a separate “working” showing the make-up of any difference between balances from two different sources. So for cash at bank there is the internal balance per the cash book (which should agree to the ledger account and the financial statements) and the balance per the bank (as shown on a bank statement).
If you look at page 77 of the FA notes https://opentuition.com/acca/fa/acca-financial-accounting-fa-notes/ you will see a proforma reconciliation.Monthly bank reconciliations are an internal control carried out by management. The auditor will substantial the year end bank reconciliation by agreeing the “balance per the bank statement” to the bank statement (and, usually, a bank confirmation letter) and agree the balance to the cash account/cash book and agree the make-up of all the differences (e.g. confirming that unpresented cheques “cleared” the bank according to the next bank statement for the month after the year end).
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