A cash book shows a positive bank balance, while the bank statement shows an overdraft The first step should be:

Type: MCQ • Marks: 1

A. Reconcile the records and investigate all differences

B. Assume the cash book is correct

C. Assume the bank is wrong

D. Ignore the matter until year-end

Explanation

A significant difference may arise from unrecorded bank charges, direct debits, errors, timing differences or other transactions.

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UPSC Principal & Vice Principal Management Finance Administration

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