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Glossary – Chapter 6

  • A control procedure to establish and verify the correct cash balance via identification of errors, irregularities, and adjustments
  • The document received from a bank which summarizes deposits and other credits, and checks and other debits to a bank account
  • Items acceptable to a bank for deposit and free from restrictions for satisfying current debts; includes coins, currency, bank deposits, etc.
  • A major component of a cash planning system that depicts cash inflows and outflows for a stated period of time
  • Short-term interest-earning financial instruments that are deemed to be highly secure and will convert back into cash within 90 days
  • An amount that must be left on deposit and cannot be withdrawn
  • Transactions are equivalent to an electronically generated check that results in an almost immediate withdrawal of funds.
  • Receipts entered on company records but not yet posted by the bank
  • Investments accounted for a fair value that generally derive their value from some other item; examples include commodity futures, options, and so forth
  • Sometimes called "mark-to-market;" to record an investment at its fair value and recognize changes in value as they occur
  • Non-sufficient funds check; a customer check returned for lack of funds (a "hot check")
  • Checks entered on company records but not yet cleared by the bank
  • A fund established for making small payments that are impractical to pay by check; also known as imprest cash fund
  • A detailed bank reconciliation that verifies not only beginning and end balances, but also validates deposits and withdrawals during the month