Internal Cash Control
ACC 220
Scenario E4-5
a) These are the following weakness I have interpreted from the above scenario:
a. There were no detailed operating procedures. Even though the purchasing agent and treasurer both had authority at issuing checks, checks could be utilized for payments, resulting in errors if unnumbered and no procedure is followed.
b. No established procedures that address a segregation of duties exist either in regards to preparing and mailing the checks.
c. The system has a general ledger, yet no subsidiary records of accounts receivable and accounts payable exists. The checks are also not secured in a limited access area under lock and key.
d. Financial reports and other documentation in the cash disbursement journal are not ensuring that the distribution of the charges is appropriately based.
e. No receipts are given to each individual that is paid by ….
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