Explain the Importance of the Bank Reconciliation to the Audit

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The Answer is The completion of a monthly bank reconciliation is an important control that affects the audit of the cash. The reconciliation ensures that the entity's books reflect the same amount of cash as the bank's after the consideration of reconciling items. A proper reconciliation can reduce the amount of audit time spent on cash. The reconciliation contains the balance per the entity's books and the balance per the bank, as well as reconciling items such as outstanding checks and deposits in transit. It may also include bank service charges and checks returned because the customer did not have sufficient cash in his account to cover the payment of the check.

Explain the Importance of the Bank Reconciliation to the Audit

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