ACCA AA · Chapter 8 · Question 9 of 12
Which of the following bank reconciliation procedures represents the strongest control?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) The reconciliation is prepared monthly by someone independent of cash recording and reviewed and signed by a senior manager
Explanation
Monthly reconciliation by an independent person, with evidenced review, detects errors and irregularities promptly and prevents the person recording cash from concealing misappropriation. An annual reconciliation is too infrequent, and allowing the cashier to reconcile their own work removes segregation of duties.
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