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SCENARIO Hanan Al Balushi (LLC) is an organization manufacturing machine component and supplying to retailers across Oman. Mr. Hussein, the CEO, when reviewing the financial

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SCENARIO Hanan Al Balushi (LLC) is an organization manufacturing machine component and supplying to retailers across Oman. Mr. Hussein, the CEO, when reviewing the financial statements of the company as a part of the internal control system, realized that the bank balance in the cashbook is not tallying with the balance in the bank statement. Mr. Hussein requested Mr. Hamed, the financial accountant of the company to identify the reasons for the differences. Mr. Hamed has requested his team members to investigate the reasons for the differences. The following is a summary of a cash book as presented by Hanan AL Balushi (LLC) finance team for the month of October. OMR 1469 Balance BD 761 Balance CD554 Payments 1262 OMR Receipts All receipts are banked, and all payments are made by cheque. On Investigation the following were discovered. 1. Bank charges of OMR 136 entered on the bank statement have not been entered in the cash book. 2. Cheques drawn amounting to OMR 267 had not been presented to the bank for payment. 3. Cheques received totaling OMR 762 had been entered in the cashbook and paid into the bank account but had not been credited by the bank until 3 November 4. A cheque for OMR22 for sundries has been entered in the cash book as a receipt instead of as a payment. 5. A cheque received from K. Abdullah for OMR 80had been returned by the bank and marked "No funds available. No adjustment has been made in the cashbook. 6. A standing order for a business rates installment of OMR 150 on 30 October had not been entered in the cashbook. 7. All dividends received are credited directly to the bank account. During October amounts totaling to OMR 62 were credited by the bank account but no entries were made in the cashbook. 8. A cheque drawn for OMR 66 for stationery had been incorrectly entered in the cashbook as OMR 60. 9. The balance brought forward in the cash book should have been OMR 711, noy OMR 761

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