Week 3 Assignment.docx - Running Head ACC 622 WEEK 3 SAMPSON INC The Efficiency of Internal Controls Kaneil Daniel ACC 622 Accounting Information

Week 3 Assignment.docx - Running Head ACC 622 WEEK 3...

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Running Head: ACC 622 WEEK 3 SAMPSON, INC 1 The Efficiency of Internal Controls Kaneil Daniel ACC 622: Accounting Information Systems Professor Edward Kaplan November 22, 2019
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ACC 622 WEEK 3 SAMPSON, INC 2 The Efficiency of Internal Controls The task to make sure that Sampson Inc. is financially sound is to have an auditor to review the financial data, bank deposits, cash receipts, write-offs, debts, refunds, and credits. These items must be clear to read and understand so that they can be verified by the auditor. In the scenario of Sampson, Inc. the economic data has discrepancies that must be checked further. In looking at Sampson Inc’s financial records it will be revealed at what type of difficulties have surfaced based on the audit and auditor’s discoveries and a solution for the problems in order to make the corrections needed and to also prevent the same problem from happening again. The first issue that has been reported by Sampson Inc. to the auditor is the lack of consistency of the bank deposits and cash receipts. A better understanding of what a bank deposit and cash receipts is explained as the following: A person will fill out the deposit slip and take it to the bank for depositing to the indicated bank account. The customer will then take the receipt for the deposit. Once back from the bank the customer will then enter the receivable into the system showing the amount of the deposit and the date funds were received. With there being an issue of the bank credits not balancing to the cash receipts journal there could be a few possible reasons such as (1) human error, (2) timing of the general ledger versus the cash receipts journal, (3) transposed numbers on the deposit slip or when it was entered into the banking system or accounting system. Some of the errors are according to our text could be a type of fraud, where the highest level of computer data is needed. In order to clear this up would be ensure with multiple deposits throughout the date and to also make sure that the receivable is posited on the same day so that it would hit the general ledger during the night process. If the receipt is posited on the cash receipts journal for example on September 30 it will not post to the
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ACC 622 WEEK 3 SAMPSON, INC 3 general ledger until October 1 after the nightly process. This should be the only time there may
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