Cash is the most liquid asset of an agency. Because of its liquidity, it is so attractive, that it is most susceptible to theft and misappropriation. [1] To guard against the loss of cash through theft or fraud, adequate cash management mechanisms and controls must be in place.

Equally important in ensuring effective cash management and protection is the timely exercise of oversight functions through periodic cash examination. Indispensable in carrying out an efficient and methodical examination of the cash accounts of an agency is a handy reference or guide that charts in simple and sufficient detail the procedures required therefor.

This revised Cash Examination Manual provides an updated guide that steers the auditors through a sequential and step-by-step cash examination process commencing from planning stage, leading to execution, reporting, and monitoring. It also defines the scope and objectives of the examination.

As in its precursor manual, the revised procedures and techniques outlined herein are designed to sufficiently cover each area or activity to be cash examined. Nonetheless, the auditor is not precluded from employing such other procedures and techniques as the circumstances may dictate. In such a case, the auditor is cautioned to exercise sound professional judgment in adopting any additional or alternative cash examination procedures or techniques.