Scribd
Upload
976 views

Audit of Cash

The petty cash count sheet has four parts: accounting for petty cash items, accountabilities, petty cashier's acknowledgment, and auditor's adjusting entries. All petty cash items including impurities are counted to identify weaknesses. Impurities do not belong in petty cash like customer checks or checks issued to clients. The petty cash shortage is calculated by subtracting accountabilities from the cash accounted. Accountabilities include the ledger balance and impurities. Notes provide guidance on specific items like unexpended contributions and customer/company checks.

Uploaded by

Joannah mae
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
976 views

Audit of Cash

The petty cash count sheet has four parts: accounting for petty cash items, accountabilities, petty cashier's acknowledgment, and auditor's adjusting entries. All petty cash items including impurities are counted to identify weaknesses. Impurities do not belong in petty cash like customer checks or checks issued to clients. The petty cash shortage is calculated by subtracting accountabilities from the cash accounted. Accountabilities include the ledger balance and impurities. Notes provide guidance on specific items like unexpended contributions and customer/company checks.

Uploaded by

Joannah mae
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 10

AUDIT OF CASH

THE PETTY CASH COUNT


The Petty Cash Fund Count Sheet

The count sheet has basically four parts as


follows:
• Accounting for petty cash items
• Accountabilities
• Petty cashier’s acknowledgment
• Auditor’s adjusting entries
Accounting for Petty Cash Items

All petty cash items, inclusive of the impurities


are counted in the working papers as the
presence of the impurities may indicate some
weaknesses in the accounting control systems
Petty Cash Impurities

are items which do not belong to the fund but for


one reason or another are nevertheless found in
the petty cash box.

Examples of petty cash impurities are:


• Bills and coins and customer’s check from the
cashier’s collections (as these should have in
the general cash)
Petty Cash Impurities

Examples of petty cash impurities are:


• Checks issued by clients in payment of utility
bills (as these should have been delivered to
the payees)
• Check issued to the client in payment of
personal advances (as these should have
been in the general cash)
Computation of Petty Cash Shortage

Petty cash accounted XX


Less: Petty cash accountabilities XX
Overage (or shortage) XX
PETTY CASH ACCOUNTED
Coins and currencies XX
Unexpended employees contributions XX
(e.g. contributions for Christmas party,
birthday party, etc.)
Cash collections of accounts receivables or XX
sales
Checks for deposits XX
Post-Dated checks (checks that are dated XX
after reporting date and cash count date)
Unreplenished vouchers (expenses, IOUs XX
that are taken from the PC Fund)
PETTY CASH ACCOUNTABILITIES
PC Fund ledger balance XX
Petty cash impurities except checks issued in XX
settlement of cash advanced from the PCF
Unexpended employees contributions XX
(e.g. contributions for Christmas party,
birthday party, etc.)
Unclaimed salary XX
Company’s check in payment of a liability XX
(e.g. utilities) (if among the checks for deposits)
Notes:
1) For unexpended employees contributions (unclaimed salary and
cash collections of accounts receivables or sales)

They should be included in the cash accounted only when


it is intact or the envelope is still closed on the cash count
date.

However, it is included as part of cash accountabilities


whether intact or not.
2) Stale checks may be included in cash accounted with
corresponding inclusion in accountabilities
Notes:

3) Customer’s checks- these are checks in the name of the


client company and the maker is a customer. These
represent collection of accounts receivables from a
customer. May be included in cash accounted with
corresponding inclusion in accountabilities

4) Company’s checks in the payment of a liability (e.g.


utilities) are excluded from the count, but should be
reported in the lower portion of the cash count sheet under
the caption “Other items counted”

5) Unused postage is generally not included in the count if


there is an unreplenished voucher for postage.

You might also like