Accounting 1 DBE/2016

SCE – Memorandum

QUESTION 1
1.1 CREDITORS' RECONCILIATION

1.1.1 Creditors' Ledger

Statement
Account of Thembeka
of Account from
Suppliers in the
Thembeka Suppliers
Books of Ekasi Traders
Balance 117 200 157 400
(a) – 49 100 
13 100 – 10 300
(b) + 2 800 
(c) + 12 500 
(d) – 6 400 
– 9 700 – 9 700
(e) –19 400 
(f) – 92 600 
9
61 200  61 200
Both totals: inspect. Must include opening balances

1.1.2 What should the owner say to Bradley regarding this incident? Explain
TWO points.

TWO points   part marks for incomplete / partial answers

 He should not take advantage of his position in management / abuse of

authority / position
 This amounts to “stealing” if done in a devious way; it is unethical
 Against business policy / compromising internal controls
 He must pay back the money; he could open an account with the business
and purchase the goods (he won't get it at cost).
 He could be liable for disciplinary action and could tarnish his good reputation
 Demotion / dismissal will be considered if caught again.
4

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Accounting 2 DBE/2016
SCE – Memorandum

2.1 QUESTION 2

2.1.1 CREDITORS LEDGER:

STATEMENT OF
ACCOUNT OF MARITI
ACCOUNT
SUPPLIERS
Balance 147 820 145 060
(a) + 1 800 
(b) - 40 950 
(c) + 30 000 
(d) - 5 400 
(e) - 8 100  - 8 100 
-16 200 two marks
(f) - 77 190 
92 470 Both totals reasonable  92 470
Totals may be different; must include the opening balance.
Focus on amounts if lines are mixed up.
Penalty for foreign/superfluous entries; -1 per line provided a mark was scored on that line. 13
2.1.2 The internal auditor insists that direct payments (EFTs) must be used to
pay suppliers.
Explain ONE reason to support his decision.
ONE reason  part-marks for partial / incomplete answers
It is quick and easy / easier to monitor / efficient / convenient / safer/ EFTs may
be lost / not time-bound (business hours) / less bank charges / no need to keep
track of outstanding EFTs / makes claiming cash discounts easier / avoid interest
on late payments 2
Explain ONE internal procedure to ensure control over this system.
ONE internal control measure  part-marks for partial / incomplete answers
For two marks:
Senior personnel authorized to make internet payments
Two people to authorise an EFT transaction (allocation of duties)
Security codes for users (unique codes) / change codes regularly
Notification from bank (sms / email) when payments are effected
For one mark: Division of duties 2

2.1.3 Besides dismissing Vernon, provide ONE suggestion for action to be taken
against him.
ONE valid point  Part-marks for partial or unclear answer
Disciplinary hearing / criminal or civil charge / suspension / demotion / transfer to
another department / deductions from his salary / written warning
Provide ONE suggestion to prevent this problem in future.
ONE valid suggestion  Part-marks for partial or unclear answer
Division or rotation of duties / one person check orders, the other receives
stock / Stock records to be updated with every invoice / Proper authorization of
orders / Ensure goods received at the gates are supported by order form and
invoice / Regular stocks counts to compare to records 4

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Accounting 3 DBE/2016
SCE – Memorandum
QUESTION 3

3.1 The bookkeeper, Litzie, says it is not necessary for her to prepare a
Creditors' Reconciliation Statement because the creditors send
monthly statements to the business anyway. What would you say to
her? State TWO points.

Any TWO valid points   Must be 2 separate points;

Award part-marks for incomplete answers
Expected responses:
 The statement could contain errors.
 This is an internal control measure.
 This will lead to detection of errors/omissions/fraud.
 To compare/check/reconcile the account to the statement.
 To ensure VAT return is correct / to assist in doing the VAT return.
4

3.2
No. Creditors' Ledger of Statement of account
KZ Stores received from Valley Ltd
Balance 112 820 182 150
A – 9 000 – 9 000
B  + 87 500
C
+ 7 200
D  - 1 400
E
 - 630
F
 + 2 100
G  - 5 250
 - 5 250
- 10 500 (2 marks)
H + 4 600
182 920 * 182 920 *
16

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Accounting 4 DBE/2016
SCE – Memorandum

3.3 3.3.1 Explain what action should be taken against J van Wyk. State
TWO points.
Any two valid points   Must be 2 separate points; Cannot conflict with each other
Award part-marks for incomplete answers

 Must be subjected to a disciplinary hearing

 Open a criminal case at SAPS
 Redeploy pending decision / suspend pending decision (on
outcome of the hearing/case)
 Require employee to refund/repay employer for the
costs/deduct from salary/take legal action for repayment
 Dismiss him as this is gross misconduct
Do not accept warning as a valid point for 2 marks unless candidate also mentions
repayment as a point – in context of R37 500 fraud, warning alone is not sufficient

For 1 mark:

Dismiss the employee / fire him; Warning; Redeploy him; Suspend

him; Sue him; Take legal action. 4

3.3.2 What must the business do to prevent a similar incident in

future? Explain THREE points.
Any THREE valid points    Must be 3 separate points;
For 2 marks:
 Division of duties so that each person serves as a check on
another / get someone else to authorise these transactions.
 Rotate duties so that employees do not have permanent
control over an aspect of the business.
 Conduct internal audits / check documents to detect the
fraud and errors.
 Physical stock control (to records) / check stock on hand to
stock records.
 When goods are received, the receiving officer must check
the stock received to the invoice and order form.
 Inform suppliers of the procedure for delivering goods to the
business and do not deviate from this.
6

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Accounting 5 DBE/2016
SCE – Memorandum
QUESTION 4

4.1 CREDITORS' RECONCILIATION

4.1.1 CREDITORS' RECONCILIATION

CREDITORS' LEDGER
STATEMENT
Balance 110 170 111 600
(a) -11 100 
(b) + 5 000 
(c) - 28 800 
(d) + 1 650 
(e) - 2 400 
(f) - 5 400 
(g) + 3 300 
(h) - 13 800 
- 1 380 
+ 44 400 
106 620  (both 106 620
totals) 14

4.1.2 State TWO internal control measures that the business can use to
prevent similar incidents from happening in future.

Any TWO relevant control measures  

 Division of duties – Pearl must not be the only person responsible for
ordering and recording goods. Rotate duties.

 Have special order forms to be signed by two people.

 Check documents regularly against deliveries.

 Do regular/random stock counts to verify stock records.

4

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Accounting/P2 DBE/November 2020(2)
NSC

QUESTION 5

5.1.1 ACCOUNT OF
STATEMENT
METEOR SUPPLIERS IN
RECEIVED FROM
CREDITORS' LEDGER OF
METEOR SUPPLIERS
COMET TRADERS
Balance R10 705 R19 120
A +1 080 
B +375 
C - 200 
(2 160 + 2 160)
D +4 320(1 mark each)
E - 5 000 
Both
Final balance 15 200 15 200  totals 9

QUESTION 6

6.1 List the corrections that the bookkeeper must make to the
Creditors’ Control Account in the General Ledger.

Balance R160 300

A (13 000) 
B 10 100 
C No entry 
D No entry 
E 470 
F (45 000) 
G No entry 
Final balance R112 870  8

6.2 Prepare the correct Creditors’ List of balances on 30 June 2014.

Fourie Traders
57 300 
(29 600 – 2 300 + 30 000 
Faure Wholesalers
53 800 
(96 500 + 2 300 – 45 000  )
Hlabiks Stores
1 770 
(44 300 – 43 000  + 470) 

112 870 
 (One part correct) 10

QUESTION 7
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Accounting 7 DBE/2016
SCE – Memorandum

7.1
Creditors’ Control
Adjustment No entry
Balance 58 270

1 x

2 x

3 (4 500)  OR
-4 500
4 825

5 480

6 x

55 075
10

72
CREDITORS’ LIST

Mango Traders (8 465 + 500 + 825) 9 790

Serengeti Stores (5 123 + 3 820) 8 943

Post Network (12 874 – 4 500) 8 374

Serengeti Wholesalers (14 869 – 3 820) 11 049

Riviria Distributors (21 119 – 4 200) 16 919

55 075

11

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Accounting 8 DBE/2016
SCE – Memorandum

QUESTION 8

Balance according Creditors control 31 105

Creditors'' journal  - 500

Debit note  - 700

Incorrect posting   +4 500

Transfer Debtor to Creditors' ledger  +1 000

 35 405
6

Balance according to Creditors list 37 415

Debit note  - 700

Debtor incorrectly added  - 1 500

Incorrect posting   - 810

Transfer Debtor to Creditors' ledger  + 1 000

 35 405
6

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Accounting 9 DBE/2016
SCE – Memorandum

QUESTION 9

9.1 CREDITOR’S LEDGER

NO. STATEMENT BALANCE
ACCOUNT BALANCE
Balance 87 320 95 400
(i) - 6 500  - 6 500 
(ii) + 900 
(iii) - 800 
(iv) + 1 250 
(v) - 4 000 
(vi) + 3 530 
+ 2 400 
(vii) - 5 000 
TOTAL 84 000 * 84 000 12
Marks awarded for correct sign with amount. Accept the use of brackets for negative
amounts *Operation, One part correct for both totals (does not have to be the same total)

9.2 As an internal auditor, what advice would you offer the owner
regarding the purchase of goods through the business accounts?
Make reference to a GAAP principle in your explanation
 
Any valid explanation Reference to the GAAP principle

The owner should not use the business accounts for private use.

Private use is always recorded as drawings.

The business account will be distorted and not reflect the correct
information of the operation of the business.

Business entity 3

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 Accounting 10 DBE/2016
SCE – Memorandum
QUESTION 10

10.2. Briefly explain how the preparation of a creditors’ reconciliation as an

1 internal control measure can assist the business in managing their
creditors effectively. Provide TWO points.
Any TWO relevant control measures  
 Errors and omissions can be detected and corrected.
 Fraud can be detected and minimised.
 The correct payment can be made to creditors.
4

10.2. Use the table provided to indicate the changes that must be made in the
2 Creditors’ Control account and Creditors’ List in the books of Titanic
Traders to take into account the errors and omissions noted. Indicate the
increase or decrease with a (+) or (-) with each amount.

Creditors’ Control Creditors’ List

Provisional balance/total R 74 715 R32 595

A + 900 
B + 3 720  + 3 720 
C - 450 

D - 32 800 

E + 8 870 

45 635 45 635

 Both totals
9

10.2. State THREE internal control measures that the business can use to
3 prevent similar incidents from happening in future.
Any THREE separate, relevant control measures   
 Division of duties – Vusi must not be the only person responsible for
ordering and recording goods.
 Rotate duties so that employees do not have permanent control over an
aspect of the business.
 Have special order forms to be signed by two people.
 Check documents regularly against deliveries.
 Do regular/random stock counts to verify stock records.
 Physical security – only one mark 6

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Accounting 11 DBE/2016
SCE – Memorandum

QUESTION 11

11.1 CREDITORS LEDGER

NO STATEMENT BALANCE
ACCOUNT BALANCE
Balance 95 160 143 460
i) + 5 400 
26 000 – 20 600

ii) - 820 
iii) - 1 240 
iv) + 1 520 
v) - 4 880 
2 440 + 2 440

vi) + 47 500 
vii) - 7 500 
TOTAL 139 300 * 139 300 * 11
Marks awarded for correct sign with amount. Accept the use of brackets for negative amounts.
*One part correct (does not have to be the same total)

11.2 Refer to Information (vi):

Provide TWO possible actions that can be taken against M. Rice.

TWO possible actions   Part marks for short/unclear answers.

 Disciplinary hearing to establish trends or extent of unauthorised

transactions.
 Deductions from salary to cover the amount outstanding.
 Legal action for malpractice.
 Demotion; transfer to some other job function.
4
Explain TWO internal control measures that the business can use to
prevent such incidents in future.
TWO points  

 Division/rotation of duties to discourage such behaviour in future.

 Authorisation for all transactions with suppliers.
 Regular audits / random audits of stock and documents.
4

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Accounting 12 DBE/2016
SCE – Memorandum

QUESTION 12

12.
1 Creditors' Ledger Statement of account
Account of Styles received from Styles
Suppliers Suppliers
Balance before
12 160 41 380
errors/omissions
A (8 700)  (8 700) 

B (950) 
C 1 540 
D 1 800 
E 5 930 
F 9 400 
G (2 925) 
H (10 275) 
Balance after 20 330  20 330 
errors/omissions one part correct one part correct

-1 per line if written in both columns except A. Must earn a mark on that line before you deduct a mark.

14

12.2 Refer to information E:

(a) Suggest TWO possible actions that the business can take
against the storeman.
Any two valid points  
Award part-marks for unclear/incomplete explanation

 Open a criminal case/Take legal action.

 Deduct the amount from his salary.
 Subject the employee to a disciplinary hearing.
 Suspend the employee pending the outcome of the hearing.
 Dismiss the employee due to his misconduct.
For 1 mark 4
Fire him/dismiss him/warning/redeploy him/sue him/take legal
action

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Accounting 13 DBE/2016
SCE – Memorandum

(b) Provide THREE internal control measures that the business

can use to prevent similar incidents in future.
Any three valid points    Must be 3 separate points;
Award part-marks for unclear/incomplete explanation

 Division of duties so that each person serves as a check on

another/get someone else to authorise these transactions.
 Rotate duties so that employees do not have permanent
control over an aspect/function of the business.
 Conduct internal audits/check documents to detect any fraud
and errors.
 Physical stock control (to records)/check stock on hand to
stock records.
 When goods are received, the receiving officer must check
the stock received to the invoice and order form.
 Inform suppliers of the procedure for delivering goods to the
business and do not deviate from this.
6

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 Accounting 14 DBE/2016
SCE – Memorandum
QUESTION 13

1.3.1 CREDITORS' LEDGER OF KAROO TRADERS

DM SUPPLIERS (CL7)
Balance per Ledger Account 47 064
Invoice 346 corrected (1 512) 
Correction of discount on EFT 207 1 000 
Invoice 135 corrected (6 929) 
Interest 29 
one part correct 39 652  8

13.2 CREDITORS’ RECONCILIATION STATEMENT ON 30 JUNE 2018

Balance as per Creditor's Statement 40 271
Credit note incorrectly recorded (816 x 2) (1 632) 
Discount not yet recorded (2 532) 
Trade discount omitted (981) 
Invoice issued after statement date 4 526 
Balance as per Creditors Ledger one part correct 39 652  7

13.3 Explain TWO benefits of using electronic funds transfer (EFT) system
rather than using EFTs for direct payments to creditors.
Any TWO suitable valid response  
 Cheaper than EFT payments or debit orders
 Less fraud and theft than with EFTs
 Payments can be made at any time
 Funds quicker available
4

13.4 State TWO consequences for the business if they do not pay the amount
due to creditors on time.
Any TWO suitable valid response  
 Business can be charged interest
 Credit rating of the business can be affected
 The business can be blacklisted
4

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Accounting 15 DBE/2016
SCE – Memorandum
QUESTION 14:

14.1 No. Creditors’ Ledger of Statement of account

Broad Stores received from Ashes Ltd.
Balance R114 485 R182 150

A. -9 500 -9 500

B. +87 000

C. +6 900

D. -1 350

E. -730

F. +2 000
-5 350 -5 350or
G.
10 700 2marks
H. +1 215

I. +4 600

TOTAL 183 285* operation 183 285* operation

18

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Accounting 16 DBE/2016
SCE – Memorandum

QUESTION 15:CREDITORS RECONCILIATION

15.1 Provide TWO reasons why it is important for the business to

prepare the Creditors' Reconciliation Statement.
Any two relevant reasons  
 It helps to detect fraud, errors and omissions.
 It helps to identify differences between the balance in the statement
and the balance in the business' records.
 It is an internal control measure. 4

15.2 Calculate the correct Creditors' Control Account balance after

taking into account the relevant errors and omissions.
CREDITORS CONTROL ACCOUNT
87 690 + 5 020 + 12 800 – 1 280 – 1 280 + 1 720 = 104 670
      one part correct 6

15.3 Calculate the correct balances for creditors Zebo Suppliers and
Leo Wholesalers, list by taking into account the errors and
omissions.
Creditor Workings Balance

Zebo Suppliers 16 580 + 12 800 +1 720 31 300*

+ 200
3 150 one mark 3 150 one mark

Leo Wholesalers 29 520 – 6 300 18 320*

– 4 900
* - operation one part correct 49 620*
10

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Accounting 17 DBE/2016
SCE – Memorandum
QUESTION 16

16.1 What is the purpose of reconciling the balance on the Creditors’ control account
with the total of the Creditors’ List from the Creditors’ Ledger? State TWO
points

TWO valid points  

The reconciliation of the balance on the Creditors Control account and the total of the
Creditors’ List is a means of internal control to ensure that no errors have been made
so that the creditor is paid the correct amount and the correct amount of discount is
received.

 It will assist the business in detecting errors/omissions in their books.

 It will show errors/omissions in the statement received.
 Detect fraudulent activities and take action.
4

1.3.2 Record the errors and omissions in the given table and calculate the correct
balance and total.

Creditors control Creditors list

Preliminary balance/total R74 715 R32 595
A 900 P
B 3 720 R 3 720 P
C (720 – 2 700) (450) PP
D (16 400 x 2) (32 800) PP

E
43 P 43 P
F 8 870 P
Correct balance/total 45 678 R* 45 678 R*
*one part correct 12

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