The primary evidence regarding year-end cash balances in the financial statements is documented in the:

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Choice "B" is correct. The primary evidence regarding year-end cash balances in the financial statements is documented in the bank reconciliation, which reconciles the balance per the bank to that per the financial statements. Choice "A" is incorrect. The standard bank confirmation does not provide evidence about certain transactions that are necessary to compute the cash balance, such as deposits in transit and outstanding checks. Choice "C" is incorrect. The interbank transfer schedule provides evidence about bank transfers over a period of time. It is used to detect kiting, not to support the year-end cash balance. Choice "D" is incorrect. A "cash lead schedule" is a schedule that summarizes all the various balances that comprise cash. It is created by the auditor and is not, in and of itself, evidence supporting cash.

The Primary Evidence Regarding Year-End Cash Balances in the Financial