Accounting 101

Front 1

Helps control cash because banks have established practices for safeguarding customers' money

Back 1

Bank Account

Front 2

Collection of money by the bank on behalf of a depositor

Back 2

Bank Collections

Front 3

Posting errors made by the bank that either incorrectly increase or decrease the bank balance

Back 3

Bank Errors

Front 4

Document explaining the reasons for the difference between a depositor's cash records and the depositor's cash balance in its bank account

Back 4

Bank Reconciliation

Front 5

Document the bank uses to report what it did with the depositor's case. Shows the bank account beginning and ending balance and lits the month's cash transactions conducted through the bank

Back 5

Bank Statement

Front 6

Posting errors made in the company's general ledger that either incorrectly increase or decrease the book balance

Back 6

Book Errors

Front 7

Physical or scanned copies of the maker's paid checks

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Canceled Checks

Front 8

Document that instructs a bank to pay the designated person or business a specified amount of money

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Check

Front 9

Two or more people working together to circumvent internal controls and defraud a company

Back 9

Collusion

Front 10

A malicious program that (a) reproduces itself, (b) enters program code without consent, (c) performs destructive actions

Back 10

Computer Virus

Front 11

The chief accounting officer of a company

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Controller

Front 12

The individual assigned responsibility for the petty cash fund

Back 12

Custodian of the Petty Cash Fund

Front 13

A deposit recorded by the company but not yet by its bank

Back 13

Deposits in Transit

Front 14

Completed by the customer, shows the amount of each deposit

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Deposit Tickets

Front 15

Streamlined process that bypasses paper documents altogether. Computer of customers communicate directly with the computers of suppliers to automate routine business transactions

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Electronic Fund Transfer (EFT)

Front 16

Rearranging plain-text messages by a mathematical process, the primary method of achieving confidentiality in e-commerce

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Encryption

Front 17

Analyzing right from wrong

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Ethics

Front 18

Compresses the approval process into a single step: Compare the receiving report to the purchase order

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Evaluating Receipts Settlement

Front 19

Outside accountants completely independent of the business who monitor the controls to ensure that the financial statements are presented fairly in accordance with GAAP

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External Auditors

Front 20

Devices that enable members of a local network to access the Internet, while keeping nonmembers out of the network

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Firewalls

Front 21

A way to account for petty cash by maintaining a constant balance in the petty cash account, supported by the fund (cash plus payment tickets) totaling the same amount

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Imprest System

Front 22

Employees of the business who ensure that the company's employees are following company policies, meeting legal requirements, and that operations are running efficiently

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Internal Auditors

Front 23

Organizational plan and all the related measures adopted by an entity to safeguard assets, encourage employees to follow company policy, promote operational efficieincy, and ensure accurate and reliable accounting records

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Internal Control

Front 24

A system in which customers pay their accounts directly to a business's bank.

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Lock-Box System

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A system in which customers pay their accounts directly to a business's bank

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Maker

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A "hot" check; one in which the maker's bank account has insuffieient money to pay the check

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Nonsufficient Funds (NSF) Check

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A check issued by the company and recorded on its books but not yet paid by its bank

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Outstanding Checks

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On a check, the person to who the check is paid

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Payee

Front 29

Fund containing a small amount of cash that is used to pay for minor expenditures

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Petty Cash

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Supports all petty cash fund payments. The petty cash ticket serves as an authorization voucher and explanation of the expenditure

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Petty Cash Ticket

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Companies that sell their stock to the general public

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Public Companies

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An optional attachment to a check that tells the payee the reason for the payment

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Remittance Advice

Front 33

An act passed by Congress, abbreviated as SOX. SOX revamped corporate governance in the US and affected the accounting profession

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Sarbanes-Oxley Act

Front 34

Dividing responsibility between two or more people

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Seperation of Duties

Front 35

A cash payment that is the bank's fee for processing your transactions

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Service Charge

Front 36

A card that shows each authorized person's signature for a bank account

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Signature Card

Front 37

Differences that arise between the balance on the bank statement and the balance on the books because of a time lag in recording transactions

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Timing Difference

Front 38

In a large company, the person in charge of writing checks

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Treasurer

Front 39

A malicious computer program that hides inside a legitimate program and works like a virus

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Trojan

Front 40

Instrument authorizing a cash payment

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Voucher