Build a Source-and-Use-of-Funds Schedule
Create a source-and-use schedule that traces funds without double counting transfers or overstating unexplained amounts.
Three controlled accounts show $1.42 million of deposits, but $580,000 appears to be transfers among the accounts. Counsel wants a clean source-and-use number by tomorrow. Source-and-use reconciliation: beginning balance + external sources - external uses = ending balance, with internal transfers shown separately. The common trap is treating every deposit into every account as a new source, which double counts money moving inside the same controlled account family. Before Deposits across Account A, B, and C total $1.42 million, reported as suspicious inflows without removing internal transfers. After External sources total $840,000. External uses total $510,000. Internal transfers of $580,000…
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