CIMA BA3 · Chapter 6 · Question 9 of 10
Why is it good practice to prepare bank reconciliations regularly?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) To identify errors and omissions in the cash book or bank statement and help detect fraud
Explanation
Reconciling the cash book to the bank statement confirms that the cash book is complete and accurate, highlights bank errors and unrecorded items, and acts as a control that helps detect misappropriation of cash.
More Bank reconciliations MCQs
- Q1In a bank reconciliation, what are unpresented cheques?
- Q2When preparing a bank reconciliation, which of the following items requires an adjustment to the cash book?
- Q3The bank statement of a business shows a balance of $6,420 in hand. There are unpresented cheques of $2,180 and outstanding lodgements of…
- Q4A cash book shows a debit balance of $3,870. The bank statement shows bank charges of $95, a credit transfer from a customer of $640 and a…
- Q5The bank statement of a business shows an overdraft of $1,240. There are unpresented cheques of $860 and outstanding lodgements of $2,300…