Financial Reporting and Reconciliation
Reports and books
The treasurer's core reports are the Report of Collections and Deposits (RCD), Report of Checks Issued (RCI) and Report of Accountability for Accountable Forms (RAAF). The accountant maintains journals, ledger, trial balance and financial statements under the Government Accounting Manual. Budget accountability reports track physical and financial performance.
Reconciliation
Bank reconciliation proves the cash book against the bank statement: adjusted bank balance = bank balance + deposits in transit − outstanding checks. Adjusted book balance = book balance + bank credits not yet recorded − bank charges not yet recorded. They must agree. Also reconcile cash on hand to the cash book and accountable forms to the series inventory.
Worked example
Bank statement P1,000,000; deposits in transit P40,000; outstanding checks P160,000; bank service charge P2,000 not in books. Adjusted bank = 1,000,000 + 40,000 − 160,000 = P880,000. Book balance P882,000 less service charge P2,000 = P880,000. The reconciliation proves.
Traps
- Plugging the difference to other.
- Omitting deposits in transit or outstanding checks.
- Reporting collections net of remittances.
- Treating the bank statement as the books.