ACC 201 ch 4

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  1. Bank reconciliation p. 176
    Matching the balance of cash in the bank account with the balance of cash in the company's own records.
  2. Cash p. 172
    Currency, coins, balances in savings and checking accounts, items acceptable for deposit in these accounts (such as checks received from customers), and cash equivalents.
  3. Cash equivalents p. 172
    Short-term investments that have a maturity date no longer than three months from the date of purchase.
  4. Checks outstanding p. 179
    Checks the company has written that have not been subtracted from the bank's record of the company's balance.
  5. Collusion p. 171
    Two or more people acting in coordination to circumvent internal controls.
  6. Deposits outstanding p. 179
    Cash receipts of the company that have not been added to the bank's record of the company's balance.
  7. Earnings quality p. 187
    The ability of net income to help predict future performance of the company.
  8. Free cash flow . p. 187
    Operating cash flows plus investing cash flows during the period
  9. Internal controls p. 166
    A company's plans to (1) safeguard the company's assets and (2) improve the accuracy and reliability of accounting information.
  10. NSF checks p. 179
    Checks drawn on nonsufficient funds, or “bad” checks from customers.
  11. Occupational fraud p. 166
    The use of one's occupation for personal enrichment through the deliberate misuse or misapplication of the employing organization's resources.
  12. Petty cash fund p. 183
    Small amount of cash kept on hand to pay for minor purchases.
  13. Sarbanes-Oxley Act p. 167
    Known as the Public Company Accounting Reform and Investor Protection Act of 2002 and commonly referred to as SOX; the act established a variety of new guidelines related to auditor-client relations and internal control procedures.
  14. Separation of duties p. 169
    Authorizing transactions, recording transactions, and maintaining control of the related assets should be separated among employees.
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ACC 201 ch 4
2012-05-16 03:51:06
Cash internal controls

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