Prof. Jon Poole
Luis Perez Jr.
a) Indicate the weaknesses in internal accounting control in handling of collections.
There is only one person doing the record keeping, this leaves a lot of room for error. If this person makes a mistake then it would go unnoticed and they would lose money. An audit should be done more often. For 15 years the church trusted one person to count the money and that’s all the insurance they had. The head usher should put the money in the bank once he finishes counting it. This would be a smarter move because of the lack of insurance. Also the head usher should not be the only one to count it. There should be another person with him when he counts the money. Once the money is counted there should be more information like who counted and what time it was counted. The secretary of the church is the only person to pay the bills and keep records of the church money activates. He is also the one to double check the books. It’s never a good idea to have one person be in charge of all the books. There is too much trust on the secretary to get everything done and get it done right. The checks are another error that should be looked into. The church wants all the checks to be written to cash. This is bad idea for one important reason; anybody can just take the check and cash it. The checks should be payable to the church. The church should have fidelity insurance.
b) List the improvement in internal control procedures that you plan to make at the next meeting of the audit team for (1) the ushers, (2) the head usher; (3) the financial secretary, (4) the finance committee.
1) The ushers
• The ushers should count the cash before it giving it to the head ushers.
• The ushers should see that the head usher counts the cash in their presence and verifies them.
2) The Head Usher
• The Head Usher should count the...