Deposits in transit and the cut-off traps they create
How timing differences between bank and ledger become material misstatements when nobody reconciles the bridge.
Deposits in transit are ordinary — until they never clear. A bag lodgement recorded on Friday may post to the bank on Monday; that is a timing bridge. A lodgement recorded and never banked is something else entirely.
Auditors sample the bridge: prior-period deposits that should have cleared, and period-end deposits that appear only on one side. Teams that keep a dated lodgement log clear those samples quickly. Teams that rely on memory invite follow-up questions.
The same discipline applies to outstanding cheques and electronic payments initiated but not yet cleared. Each needs a clear ageing rule and a person who confirms the counterparty still expects the payment.
Build the cut-off checklist into the reconciling pack itself. Leaving it as tribal knowledge guarantees a scramble when staff rotate.