Cash Balance Confirmation Certificate format
A Cash Balance Certificate is an essential document used to confirm the cash balance of a company as of a specific date, providing reliable evidence of cash holdings for auditors. This guide offers a ready-to-use format for a Cash Balance Certificate, along with key points to ensure it meets audit requirements and aligns with standard accounting practices.
What is a Cash Balance Certificate?
A Cash Balance Certificate is a formal document issued by an entity or auditee to confirm the actual cash balance held by the entity as of a specific date. This certificate is issued to external auditors (Statutory auditors) as part of the audit process and serves as evidence of the cash physically available within the entity, either on hand or at banks.
Key Points in a Cash Balance Certificate
- Date and Balance Confirmation: It states the exact cash balance as of a specific date.
- Verification: Often includes details of physical verification, mentioning cash counted and matching it with internal records.
- Authorized Signature: The certificate is signed by an authorized person of the entity, confirming the cash balance’s accuracy.
Purpose of the Cash Balance Certificate
- Audit Evidence: Provides reliable confirmation of cash holdings, used by auditors in verifying an entity’s financial position.
- Internal Validation: Helps ensure that cash records and physical cash holdings align, supporting accurate financial reporting.
Usage in Audit
In auditing, the Cash Balance Certificate serves as part of audit documentation under the guidelines of SA 505 (External Confirmations) and SA 230 (Audit Documentation), enhancing the audit’s credibility by independently verifying cash balances.
Format for Cash Balance Certificate in Word
(On the letterhead of the Company)
Date: 31.03.20____
To
ABC & Co
Chartered Accountants,
Plot No.6, 303B Arrow Corporate Tower,
Sector 14, Kaushambi, Ghaziabad
UP 201012
Ref: Cash Balance Confirmation as of 31.03.20____(Balance sheet date)
Dear Sir/Madam,
We confirm that the cash-in-hand balance as of 31 March 2024 is Rs.________________ (in words) in the books of accounts of M/s ALBANIA Innovative Equipment Pvt Ltd.
This confirmation has been issued to the Statutory Auditor for Audit Purposes only.
Kindly consider the above statement.
Thanking you,
For M/s. ALBANIA Innovative Equipment Pvt. Ltd.
Name of Authorized Signatory
(Designation)
(contact information)
Date: 31.03.20_____
Place: