Control Account Reconciliations

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion

I work in accounts & am studying foundation level. I am having trouble understanding the theoretical side of control account recs, could someone give me an example in reall business of the ledger accounts being 'overcast'??

Thanks to anyone who can help!!

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Control Account Reconciliations

    Unfortunately, in real life this is a problem which hardly occurs nowadays due to computerisation of the ledgers.

    If you consider the sales ledger control account. The balance on this ledger control account has to equal the sales ledger debtors listing. If the aged debtors listing amounts to £1,000 and the sales ledger control account equals £2,000 then the sales ledger control account is "overcast". In other words added up £1,000 too much.

    Kind regards
    Steve
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Control Account Reconciliations

    That's great, thanks. :)

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