[vanessa000abc]

Hello,

I have the same question like the one I google from website.

“What is the difference between bank reconciliation and cutoff bank statement? My understanding is that auditors use cutoff bank statement to ensure the transactions were recorded in the proper accounting period. Do auditors use cutoff bank statement and bank reconciliation for the same purpose?

What is the difference between bank transfer schedule and cutoff bank statement? I know auditor uses bank transfer schedule for detecting kiting by comparing the dates checks are drawn to the dates checks are deposited. Becker also memtions that cutoff bank statement used for testing of kiting. Isn’t bank transfer schdule more appropriate than cutoff bank statement?”

Thank you.

[musicamor]

A bank reconciliation is a schedule that is prepared by the accountant. It shows those items that are necessary to agree the ending bank balance to the ending balance per the G/L.

A bank cut-off statement is a bank statement; much like the one you receive on a monthly basis from your bank.

Both are used by the auditor to perform tracing and vouching activities.

Texas CPA - licensed in 2012!!!

[Noct]

A bank reconciliation checks the general ledger activity against the bank statement for the same period to ensure that all cleared transactions are recorded, and that there aren't erroneous records on the G/L.

A cutoff bank statement is looking at the statement from the following month and checking for transactions which were actually initiated in the month before which hadn't cleared. It is therefore more thorough than a normal bank reconciliation because unrecorded/uncleared transactions will not be detected by reconciliation alone.

FAR - 79 - 07/2012
AUD - 65, 78 - 11/2012
BEC - 76 - 11/2012
REG - 78 - 01/2013
ETH - 98 - 01/2013

Material: Wiley books

[Jsmi77y]

And from what I understand cut-offs are used to test for completeness assertion.

REG - 68 | 71 | 88 | 86
FAR - 72 | 74 | 79
AUD - 66 | 70 | 77
BEC - 62 | 74 | 80

Guess that means I'm a soon-to-be CPA!

[Author]

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