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Banking Procedure, Page 16

Key Terms

The key terms used in the unit are listed below: 

  • Internal control: Internal controls over cash are sometimes regarded as a means to prevent fraud and theft. 
  • External control: External controls are measures and procedures adopted outside the business to protect cash and other assets. 
  • Protecting cash: Protecting cash is essential for the success or survival of every organization. 
  • Signature card: A signature card contains the signatures of those who are authorized to draw checks on a specific account. 
  • Deposit slip: The deposit slip contains a detailed record of the deposit made by the depositor. 
  • ABA Number: The American Bankers Association (ABA) number is the fractional number printed in the upper right corner of a check, just below the check number. 
  • Endorsement: An endorsement is an authorized signature written or stamped on the back of a check to transfer the ownership of the check. 
  • Drawer: The person who signs the check is the drawer. 
  • Drawee: The bank on which the check is written is the drawee. 
  • Voiding a check: Voiding a check means canceling the check.