The internal control over cash disbursements need to be revised. To maintain, proper and organized documents each check written by this company will have a number on it. For the safety of our investments the numbers will help locate any check that we will need to look at for review. We will meet tomorrow for a conference on this situation and would like your ideas on strengthening our internal control.
The internal control principles and their application to cash disbursements of Guard Dog Company is all checks must now be
Prenumbered and written by using the new check writer purchased by the company, the check amount and invoice amount must be correct. Only the treasure and the assistant have the code to the combination to all files. weakness in internal accounting control in the handling of collections is that there is no record of how much is actually in the collection basket, no one knows who actually contributed to the basket either.
My procedures would be to have the ushers give out receipts to the people who contributed to the basket, the head user would have to count the money and see if it matches up with the receipts, and the financial adviser would have to recount the money and receipts. And the finance committee will determine what is needed to be purchased with the money and how much stays in the bank.
Any company will have accurate records and easy cash flow if the followed the five basic procedures. It is common sense to make sure there is numbers on a check so it can be identified. There should be specific employees assigned to make sure anything the company pays is in written. All the money...