ACC 220 Week 4 Internal Cash Control

ACC 220 Week 4 Internal Cash Control - Internal Cash...

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Internal Cash Control Internal Cash Control Chrissy Weeks ACC/220 July 21, 2011 Alicia Hubbard
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Internal Cash Control Internal Cash Control The following paper visits how a company could use the five basic principles of cash management to increase the accuracy for a business. Scenario E4-5: Internal Control of Cash Disbursements The weaknesses that I found regarding internal control over the cash disbursements of the Idaho Company are: checks are not prenumbered, the unissued checks are kept in an unlocked filing cabinet, and there are one too many people who are authorized to issue checks. In regards to the checks not being prenumbered, this does not follow proper documentation procedures. The lack of securing the unissued checks does not follow proper physical, mechanical, and electronic control. Lastly, the responsibility of two employees issuing checks does not follow proper segregation of duties control. MEMORANDUM TO: Corporate Office FROM: Auditing Agency DATE: July 21, 2011 SUBJECT: Internal Control over Cash Disbursements CC: Board of Directors In response to the weaknesses’ of internal control, your company should implement a number of internal control principles. These new practices should be put into effect immediately at all divisions within the organization in order to maximize the company’s accuracy of accounting data and records.
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Internal Cash Control The first change that I am suggesting concerns your current method of issuing checks. Manually numbered checks should no longer be utilized. Instead, checks that are issued should be
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ACC 220 Week 4 Internal Cash Control - Internal Cash...

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