Beruflich Dokumente
Kultur Dokumente
Cash not just include currency and coins but also those that are acceptable by bank for deposit or
immediate encashment such as checks, bank drafts and money orders.
Cash is measured at face value. Cash in foreign currency is measured at current exchange rate
If the financial institution holding the funds of an entity is in bankruptcy or financial difficulty, cash
should be written down to estimated realizable value if the amount recoverable is estimated to be lower
than face value
deposits in foreign investment which are subject to foreign exchange restriction, if material, should be
classified separately among noncurrent assets and the restriction clearly indicated.
Details comprising cash and cash equivalents should be disclosed in the notes to financial statements
the credit balance in the cash in bank account results from the issuance of checks in excess of the
depositsoverdraft
if entity maintains two or more accounts in one bank and one account results in an overdraft, such
overdraft can be offset against the other bank account with debit balance in order to show, cash, net of
bank overdraft
An overdraft can also be offset against the other bank account if the amount is immaterial
if the deposit is legally restricted because of a formal compensating balance agreement, the
compensating balance is classified separately as cash held as compensating balance under current assets
if the related loan is short term, otherwise, it is classified as noncurrent investment
In banking practice, checks become stale if not encashed within 6months from the time of issuance
Cash
Miscellaneous Income
If material and liability is expected to continue, cash is restored and liability is again set up
Imprest system- system of control of cash which requires that all cash receipts should be deposited intact
and all cash disbursement should be made by means of check.
In imprest system, payment of expenses requires no formal entries. Petty cashier generally requires a
signed petty cash voucher for such payments and prepares memo entry in the petty cash journal.
Petty cash disbursement should be replenished only by means of check and not from undeposited
collection
If not replenished, the entry is to state the correct cash fund is:
expenses
Under fluctuating fund system, checks drawn to replenish the fund do not necessarily equal the petty
cash disbursement. Expenses are immediately recorded and PCF fluctuates from to time.