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Proof of Cash
December 4, 2009josephmestrada12 comments

Proof of Cash or Four Column

Reconciliation
Ok, sa topic ng cash, ito ang masasabi ko na ultimate in terms of difficulty. Kelangan ng
understanding ng entries na ginagawa ng company at ng book. Kelangan din ng application ng logic.

Una sa lahat, ano ba ang Proof of Cash? Every month, gumagawa ang kumpanya ng Bank
Reconciliation (bank recon in other words). Ngayon, ang preparation ng typical bank recon,
nagpapakita lang ng effect nya sa total balance ng isang Cash in Bank account. When the company
smells something fishy regarding the custodian or in more technical terms, when the company
believes that fraud exists in handling of the cash balances, dapat maging mas detalyado ang
ginagawang reconciliation wherein every transaction na nangyayari sa cash, ippresent in details. That
is where Proof of Cash comes into scene.

Ok, let’s start. Ipapakita ko muna sa inyo yung problem, then yung solution ko, tapos, ieexplain ko sa
inyo kung bakit ganoon.

Bakit nga ba baliktad sa bank?

Bank Credit – addition to bank balance

Bank debit – deduction from bank balance
kasi, bilang “customers” ng bank, pag nagdedeposito tayo ng pera sa banko, ang treatment nila dun
ay liability sa depositor. So, pag sinabing bank “credit” ibig sabihin nadagdagan yung liab nila sa
depositor, nadagdagan ang balance ng cash ng depositor and bank “debit” kasi nbawasan yung
liability nila sa depositor ksi nabawasan yung pera ng depositor sa bank.

pag may tanong itanong lang po. sunod yung sinasabi kong bank errors at nsf checks.

PROBLEM
Balance per company’s ledger
Nov. 30 520,000
Dec. 31 700,000
Total debits to cash per company’s books
(recorded receipts) during December 2,500,000
Total credits to cash per company’s books
(recorded disbursements) during December 2,320,000
Bank Balance
Nov. 30 537,400
Dec. 31 678,200
December receipts recorded by Bank
during December 2,474,400
December disbursements recorded by Bank
during December 2,333,600
Deposits in Transit
Nov. 30 160,000
Dec. 31 225,000
Oustanding Checks
Nov. 30 143,000
Dec. 31 118,000
Bank Service Charges(recorded by the
depositor in the month following the month
of charge)
November 1,200
December 800
Bank credit memo for customer’s note
collected by bank in November
(face value 60,000plus interest 600),
recorded by the company only
in december. 60,600
Bank credit memo for proceeds of
bank loan granted
by the bank on Dec. 31. 100,000
Customer’s DAIF check returned by the bank
(recorded by the company
in the following month)
Returned in November 25,000
Returned in December 14,000

Solution:
Mga dapat tandaan:

1. Ang kinokompyut natin na ending balance ng Deposits/Withdrawals-Receipts/Disbursements ay

STRICTLY para lamang sa Deposits/Withdrawals-Receipts/Disbursements ng current month. Lahat ng
Deposits/Withdrawals-Receipts/Disbursements ng previous months, tanggalin doon.
2. Papanong nagiging equal ang Deposits/Withdrawals-Receipts/Disbursements ng bank at book?
Since sa transactions ng current month nga lang yung syempre dapat kung ano ang Receipts mo sya
rin ang Deposits mo at kung ano ang Disbursements mo ay sya rin ang Withdrawal mo.
3. Gagawin mo ang ginagawa ng banko. Bakit? Kasi hindi mo naman pwedeng pakialaman ng books
ng bank. (except syempre pag may bank error kasi kapag bank error, ang bank ang kusang
nagcocorrect nun).
4. Huwag isiping negative yung Disbursement/Withdrawal column. Ang pinag-uusapan kasi dun, kung
magkano yung disbursement/withdrawal mo. (gets to?)
Sa pagpprepare ng proof of cash, take it one step at a time. Wag paghaluhaluin.

Ok, as I will explain I will use the following terms para madescribe ang column:
FIRST COLUMN – ito yung recon last month
LAST COLUMN – ito yung recon this month
Una, gawin ang pinakamadaling part that is, ilagay sa tamang column ung mga unadjusted balance
Bank’s previous month, deposits, withdrawal, current month and book’s unadjusted previous month,
receipts, disbursements, current month.

Tapos, yung details na. take one step at a time. Kung gusto mo unahin yung bank tapos yung books,
gawin mo. Ikaw bahala. Basta isa isa lang.

Ok unahin natin yung

Bank
Deposit in transit.
Ano ba ang deposit in transit. Yan ung mga payments ng customers/debtors/payor, na katapusan ng
buwan na ginawa yung payment kaya hindi na umabot yung tseke sa tamang petsa. Kung baga, sa
cutoff lang may problema. Kasi ganito ang nangyari. Nagbayad yung customer. Edi binigay yung
cheke sa kumpanya. Pagbigay ng cheke sa kumpanya, syempre, ang gagawin ng company, irerecord
nya bookd nys. Saka nya idideposito sa banko. Ngayon, pag pasok nun sa bank, hindi naman agad
maccredit yun sa account mo. It will undergo a clearing process para icheck kung
legitimate/genuine/negotiable ba yung cheke na diniposito mo sa bank. It will take a couple of days
bago maclear yun. So, pag na-clear, ok, iccredit na ng bank sa account mo yun. Kaya nagkakaroon ng
deposits in transit. Narecord mo na yung receipt sa book mo pero sa banko, hindi pa.
So, papano ang treatment nun? Ganito.

PREVIOUS Month

Diba ang first column yun ung recon ng last month. So, since DIT sya last month, add nyo s first
column ng bank.
Kasi dapat talaga, receipt nyo na sya last month pero ngayon lang na-credit sa account nyo. So since
ngayon lang ncredit sa account nyo, narecord sya ng bank as “deposits this month”. E diba nga sabi
ko, yung deposits/withdrawals na icocompute natin ay para lang sa current month, kaya ibabawas
natin sa receipts column yung DIT last month.
CURRENT Month.
Eto, sabi ko diba due to timing difference, hindi tuloy naadd ng bank sa inyo yung amount na yun
kaya hindi nagreflect sa statement nyo. So ano dapat gawin? Eh di iadd nyo sa Deposits column ng
bank para tumugma ang receipts at deposits nyo.
Outstanding checks.
Pareho lang ng logic nito sa Deposit in transit. Yun nga lang, dito naman, tayo ang
magdidisburse/gagastos/payor. Pareho din ng proseso ang ia-undergo ng cheke and all.
Previous month
Sa previous month, or first column, syempre deduct to kasi disbursement talaga natin sya for
november. Pero, since hindi pa sya nareflect sa statement noong November, malamang sa malamang,
naisama sya sa withdrawals total nyo for december. So, hindi ito nabibilang doon kaya dapat
tanggalin. Deduct from Withdrawals column.
Current month
Sabi natin, ang outstanding check ay ang mga cheke na hindi pa nadedebit/nababawas (tandaan
baliktad sa banko ha, paliwanag ko mamaya kung bakit). So, hindi pa sya kasama sa withdrawal. So,
idadagdag natin sya sa withdrawals column for the month. At syempre, bawas sya sa december 30
column kasi nga disbursement to.
Maliwanag na sa sikat ng buwan ang Bank?

Book
Bank Service Charges
Ang bank service charge ay ang mga amounts na binabawas sa account natin kabayaran sa serbisyo
ng banko sa pagtatago ng pera natin. Considered as expense to sa books. Ok. Simple lng nman to.
Previous month.
Pareho din ng logic nito sa DIT/OC, timing difference ang dahilan ng mga ginagawa sa proof of cash.
So, sa first column natin, since kabawasan sa account natin at nalaman lang natin sa current sttement
na may bank service charge pala noong nakaraang buwan, edi ibawas natin sa column ng previous
month at IBAWAS din sa column ng disbursement. Bakit? Eh kasi hindi naman sya disbursement this
month, noong nakaraang buwan sya disbursement. Ang total na pinaguusapan sa
receipts/disbursement columns nyo sa isang proof of cash ay ang receipts/disbursements lang ng
current month.
Current month
So, sa current month, i-ADD ito sa disbursement s column nyo kasi disbursement sya this month. At
IBAWAS sa Dec. 30 column dahil disbursement/cash gastos sya. Tandaan ah, huwag isiping ang
buong disbursement column ay negative.
Bank Credit memo.
Pag sinabing “bank credit memo” ito yung mga DAGDAG sa account mo dahil sa koleksyon ng banko
from customers and some other transactions na nakadagdag sa bank balance mo na hindi mo alam
kaya pinapaalam ng bank sayo. Kung bakit credit memo ang tawag sa knya eh dagdag naman sya,
papaliwanag ko mamaya. So, same logic po.
Previous month.
Ang bank credit memo na dapat ay dagdag noong nakaraang buwan na ngayon mo lang buwan
naidagdag sa receipts mo ay magccause ng overstatement ng receipts mo for the month of december
(current month) at understated naman ang cash balance mo for november (previous month) so, sa
first column, ADD para hindi na understated ang cash balance mo nuong november. Sa Receipts
column naman, ibawas kasi nga pang-previous month receipts sya. Hindi sya pang current month.
Current Month
Sa receipts column, dagdag, kasi nakita mo lnag sa bank statement na may dagdag ka pala at hindi
mo pa sya nairerecord sa book mo. Tapos since dinagdag mo sya sa receipts mo, may effect sya sa
last column so idagdag din.
NSF checks
Muli, ng NSF check ay ang chekeng tumalbog. Dito, ang pinag-uusapan ay cheke ng customer ah.
Previous month
Ang chekeng tumalbog, binabalik sa kumpanya yung cheke mismo at may tatak na “No Sufficient
 Fund”. Diba koleksyon to mula sa customer? So, ang gagawin ng kumpanya, irereverse nya yung
naentry nya nung nagbayad ang customer so ang entry nya:
(dr) Accounts receivable xxx
(cr) cash xxx
Since credit yung cash, papasok sya sa ledger as disbursement at HINDI kabawasan sa receipts.
Tandaan yun ah. Kasi usually mababasa yang credit to cash na yan as disbursement lalo na pag
computerized ng system mo.
Ang nangyari naman dito, ito yung mga NSF checks na tumalbog nung end of the month kaya
dumating na satin yung tumalbog na cheke the next month at nairecord din nung sumunod na buwan
pero tumalbog talaga sya noong nakaraang buwan.
O, para medyo magulo, papano kung ang sabi “a collection last month which was proven NSF this
month”, kelan sya icoconsider na nsf, nung previous or current month? Edi sa CURRENT MONTH. Pag
nsf check pinaguusapan, ang iisipin nyo lang kung kelan tumalbog para hindi kayo maguluhan.

Previous month
Ok, so ang gagawin, since para talaga sya sa previous month pero ngayon lang nabawas sa cash in
bank account natin, ibawas natin sya sa NOVEMBER column. At since nakarecord sa ledger balance mo
na disbursement sya this month, pero pang previous sya, ibawas sa disbursement column. Malinaw?
Current month
Since ngayong buwan sya kabawasan, iccredit mo yung cash mo so, dagdag sya sa disbursement
column at since disbursement sya, ibawas sya sa dec. 30. Column
Sample Problem Source: Intermediate Accounting Vol. 1 by Robles & Empleo
Categories:Proof of Cash

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