Cash-based accounting

Elizabeth Dodd edodd at billiau.net
Wed Aug 13 05:47:25 EDT 2008


On Wed, 13 Aug 2008, Maf. King wrote:
> I think that one of the reasons to reconcile is to ensure that the bank
> haven't messed up a transaction (as recently brought up on  the list), or
> that the cheque hasn't got lost in the post and you are about to have
> the 'leccy supply cut off.... An advantage that is lost in your daughter's
> approach.

I learnt bookkeeping from my mother's textbooks from the 60s.
(Bored child, I was)
you keep your books, and the bank keeps their's.
at the end of the month you check off the statement
subtract the unpresented cheques from the bank's total
do something with the unrecorded deposits too
and your total and their total should agree.
The concept of doing your books from the banks is weird to me, and Maf sums it 
up - you aren't checking those unpresented cheques.
I'm declared to be on cash accounting by the ATO, but I do my GST on accrual, 
as gnucash does it that way, and no-one complains.

-- 
Ever get the feeling that the world's on tape and one of the reels is missing?
		-- Rich Little


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