New Controller Guidebook 2nd Edition Text - CPE …

1 Controller Guidebook 2nd Edition Steven M. Bragg Table of Contents Chapter 1 The Controller Job Description ..1 Learning Objectives ..1 The Controller Job Description ..1 The Chief Financial Officer Job Description ..2 The New Controller Checklist ..4 Summary ..7 Review Review Answers ..9 Chapter 2 Cash Management ..10 Learning Objectives ..10 Controller Responsibilities ..10 Overview of the Bank Reconciliation ..10 The Bank Reconciliation Procedure ..11 Bank Reconciliation Problems.

2 12 The Bank Reconciliation Statement ..12 Accounting for Petty Cash ..13 The Cash Forecast ..14 Cash Investments ..16 Negative Cash on the Balance Sheet ..17 Cash Controls ..17 Cash Keeping ..18 Cash Record Keeping ..18 Summary ..19 Review Review Answers ..21 Chapter 3 Credit and Collections Management ..22 Learning Objectives ..22 Controller Responsibilities ..22 Receivables Measurement ..22 Credit Management ..24 Credit Terms and the Cost of Credit ..26 Collections Management ..27 Other Cash Acceleration Techniques.

3 29 The Allowance for Doubtful Accounts ..30 The Direct Write-off Method ..32 Credit and Collection Controls ..32 Summary ..33 Review Review Answers ..35 Chapter 4 Billing Management ..36 Learning Objectives ..36 Table of Contents ii Controller Responsibilities ..36 Billing Management ..36 Structure of the Invoice ..38 Accounting for Billings ..40 Accrued Revenue ..40 Accounting for Sales Taxes ..41 Billing Controls ..43 Summary ..43 Review Review Answers ..45 Chapter 5 Inventory Management ..46 Learning Objectives.

4 46 Controller Responsibilities ..46 The Periodic Inventory System ..46 The Perpetual Inventory How to Set Up Inventory Record Keeping ..48 Cycle Counting ..48 Inventory Reconciliation ..49 The Physical Inventory Count ..51 Inventory Costing ..51 The First In, First Out Method ..52 The Weighted Average Method ..54 Standard Costing ..55 The Retail Inventory Method ..56 Accounting for Obsolete Inventory ..57 Summary ..58 Review Review Answers ..60 Chapter 6 Fixed Assets Management ..61 Learning Objectives.

5 61 Controller Responsibilities ..61 Fixed Asset Tracking ..61 Tag Tracking ..61 Bar Code Tracking ..62 RFID Tracking Active Transmission ..62 RFID Tracking Passive Transmission ..63 Accounting for Fixed Assets ..63 Fixed Asset Controls ..65 Controls for Fixed Asset Acquisition ..65 Controls for Fixed Asset Theft ..65 Controls for Fixed Asset Disposal ..66 Fixed Asset Record Keeping ..66 Audit Requirements ..67 Summary ..68 Review Review Answers ..70 Table of Contents iii Chapter 7 Accounts Payable Management.

6 71 Learning Objectives ..71 Controller Responsibilities ..71 Accounts Payable Management ..71 Three-Way Matching ..73 Use Taxes ..74 Accounting for Accounts Payable ..75 Accounts Payable Controls ..76 Accounts Payable Record Keeping ..77 Summary ..77 Review Review Answers ..80 Chapter 8 Equity Management ..81 Learning Objectives ..81 Controller Responsibilities ..81 Accounting for Stock ..81 The Sale of Stock for Cash ..81 Stock Issued in Exchange for Non-Cash Assets or Services ..82 The Repurchase of Stock (Treasury Stock).

7 82 Accounting for Dividends ..83 Summary ..85 Review Review Answers ..87 Chapter 9 Payroll Management ..88 Learning Objectives ..88 Controller Responsibilities ..88 Payroll Cycle Duration ..88 Streamlined Timekeeping ..90 Timekeeping Systems ..91 Computerized Time Clocks ..91 Internet-Based Time Tracking ..92 Electronic Payments ..93 Payments by Direct Deposit ..94 Payments by Pay Card ..95 Employee Self-Service ..95 Manager Self-Service ..96 Transaction Error Analysis ..96 Staff Training Program ..97 The Payroll Calendar.

8 97 Information Confidentiality ..98 Accounting for Payroll ..99 Primary Payroll Journal Entry ..99 Accrued 100 Accrued Bonuses .. 101 Accrued Commissions .. 102 Manual Paycheck Entry .. 102 Table of Contents iv Employee Advances .. 103 Accrued Vacation Pay .. 103 Payroll Controls .. 104 General Controls .. 105 Payroll Calculation Controls .. 105 Check Payment Controls .. 106 Direct Deposit Controls .. 107 Self-Service Controls .. 107 Garnishment Controls .. 107 Employee Advances Controls .. 108 Summary .. 108 Review 109 Review Answers.

9 111 Chapter 10 Department Management .. 113 Learning Objectives .. 113 113 Controller Responsibilities .. 113 Schedule of Activities .. 113 Error Tracking System .. 114 Process Reviews .. 116 Queue Management .. 117 Department Layout .. 117 Skills Review and Training .. 118 Consolidate Accounting .. 119 Summary .. 120 Review 121 Review Answers .. 122 Chapter 11 Closing the Books .. 123 Learning Objectives .. 123 123 Controller Responsibilities .. 123 Prior Steps: Update Reserves .. 123 Core Steps: Issue Customer Invoices.

10 125 Core Steps: Value Inventory .. 126 Core Steps: Calculate Depreciation .. 128 Core Steps: Create Accruals .. 130 Core Steps: Consolidate Division Results .. 130 Core Steps: Eliminate Intercompany Transactions .. 131 Core Steps: Review Journal Entries .. 131 Core Steps: Reconcile Accounts .. 131 Core Steps: Close Subsidiary Ledgers .. 133 Core Steps: Create Financial Statements .. 133 Core Steps: Review Financial Statements .. 134 Core Steps: Accrue Tax Liabilities .. 134 Core Steps: Close the Month .. 134 Core Steps: Add Disclosures.