ACC201-HW5 - 6-1A For each of these five separate cases...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
6-1A For each of these five separate cases, identify the principle(s) of internal control that is violated. Recommend what the business should do to ensure adherence to principles of internal control. 1. Chi Han records all incoming customer cash receipts for his employer and posts the customer payments to their respective accounts. In this case, this violates the principle of “Separate recordkeeping from custody of assets.” The company should employ another person to post the payments to the customer’s accounts because a person with control over the physical cash will be less likely to commit theft or fraud if they know another person has to keep its records. 2. At Tico Company, Jenn and Kirsten alternate lunch hours. Jenn is the petty cash custodian, but if someone needs the petty cash when she is at lunch, Kirsten fills in as custodian. This scenario violates the “Divide responsibility for related transactions” principle, or separation of duties. A company should have an independent person to control the petty cash fund, this will prevent less mishaps or duplicate transactions.
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern