Auditors tests of the client's bank reconciliation is done to verify whether the client's recorded bank balance is the same amount as the actual cash in the bank. Which of the following would not explain a difference between the company's cash balance and the bank's balance for the client?

Question

Quizplus · Accepted Answer

The cash collected on a Note Receivable by the bank would not explain a difference between the company's cash balance and the bank's balance for the client, as it would only increase the cash balance in the bank and not affect the company's recorded cash balance. The other options, Deposits in transit, Other reconciling items and Outstanding checks, are all reconciling items that could explain the difference between the two balances.

Auditors Tests of the Client's Bank Reconciliation Is Done to Verify