All 26 Bank Reconciliation questions
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Bookkeeping › Bank Reconciliation

How would a fraudulent unrecorded withdrawal be detected in reconciliation?

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Answer

A fraudulent withdrawal appears on the bank statement but not in the cash book, surfacing as an unexplained difference during reconciliation. Investigation of the item—checking authorization, payee, and supporting documents—reveals it. Regular reconciliation by an independent person is the key control that catches such items promptly.
Real-world example An unauthorized transfer on the statement with no cash book entry is caught as an unexplained reconciling difference.

Common follow-ups: Why does it appear as a difference? | Which control catches it?

Cash Book & Petty Cash Control Accounts Bank Reconciliation
All 26 Bank Reconciliation questions