Acc 220 week 4 day 7 Internal Control

Acc 220 week 4 day 7 Internal Control - Internal Cash...

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Internal Cash Control1 Internal Cash Control ACC 220 Johnise Caesar October 31, 2010 Alicia Hubbard
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Internal Cash Control2 Many companies have issues with their cash handling procedures. They do not know how to track where their cash is going, nor do they know how to regulate the procedures involved. So, what are the correct cash handling procedures? The following examples will show how some companies currently handle their cash, and various ways these principles can be improved. In the first scenario, at Idaho Company, there are eight weaknesses in internal control that deal with cash disbursements. WEAKNESS 1. Checks are not numbered 2. More than one person is authorized to sign checks 3. Purchasing Agent pays bills and records them 4. Un-issued checks are kept in an unlocked drawer 5.Treasurer pays bills and records them 6.Treasurer reconciles checking account 7. Purchasing Agent approves bills for payments that he makes 8. Purchasing Agent doesn’t mark bills as paid before filing them CORRECTION Checks should be pre-numbered in sequential order only one person should be authorized to sign checks. These duties should be segregated to different individuals Unsecured blank checks should be locked in a safe that has limited access These duties should be segregated to different individuals Treasurer should be only be responsible for reconciling the check book These duties should be segregated to different
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This note was uploaded on 12/04/2010 for the course ACC 220 220 taught by Professor Aliciahubbard during the Spring '10 term at University of Phoenix.

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Acc 220 week 4 day 7 Internal Control - Internal Cash...

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