Cash Control Week 4

Cash Control Week 4 - Assignment: Internal Cash Control...

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Assignment: Internal Cash Control Axia College of University of Phoenix Diana Temple
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Everyone will agree that a business cannot operate without cash. In most parts, that's the objective of opening the doors in the first place- to make money. With that said, a successful business must have a system in place to manage generated profits. It is very important that each business have a proficient cash management overseer that can manage cash properly and be able to prevent losses in every way possible. It is very important for this person or department to control internal accurate and reliable accounting records to safeguard the company's assets. In most cases, there are five basic principles of cash management that any successful company will use to protect its assets and to enhance the accuracy and reliability of its accounting records. I will examine three different scenarios to determine how well they manage and protect their company's cash. I will make suggestions on each scenario so that a proper determination can be assessed on whether a company is protecting their cash properly or there is need for improvement. The Idaho Company has a weak system of cash control. Checks are not renumbered and both the treasurer and the purchasing agent are authorized to issue checks. Nobody knows what the other person is doing with regard to checks being distributed. The checks are kept in an unlocked cabinet. The purchasing agent is the only person that pays the bills pertaining to goods purchased, verifies invoice accuracy, and records the cash disbursements. The treasurer pays all other bills, records them, and files them. In addition, the treasurer is responsible for reconciling the company’s only account. There are a few ways the Idaho Company could improve their cash control procedures. First suggestion would be that all checks be p renumbered to provide evidence that transactions took place. This will ensure that all transactions are recorded properly and both responsible individuals are aware of the transactions by the other person. Signatures on the checks will show who is responsible
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Cash Control Week 4 - Assignment: Internal Cash Control...

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