Over and Short
Candlefocus EditorOver and short accounting can be extremely important in the retail and banking industry, as discrepancies in cash from over or short can be substantial. For this reason, it is important to have an over and short account in order to keep track of these discrepancies and ensure that the firm's financials remain accurate.
In an over and short account, discrepancies can be accounted for in a variety of ways. If a discrepancy is found and found to be in favor of the company, it is known as being “over” and the money is credited to the account to reflect the influx of funds. If it is discovered that the discrepancy is against the firm, it is known as “short” and the amount is debited from the account.
Over and short accounting is most often used to ensure that the correct amounts of cash have been accounted for and that no discrepancies in the financials have been overlooked. This can help the company identify and fix possible issues early on and can help the firm to remain compliant with applicable regulations.
Overall, over and short accounting can be a very important and helpful tool in the retail and banking industry. By having an over and short account, discrepancies can be identified, tracked and remedied quickly and accurately, which allows the firm maintain efficient and accountable financials.