Chapter 8. Internal Control. Chapter 8-1
|
|
- Helen Lambert
- 8 years ago
- Views:
Transcription
1 8 Internal Control and Cash 8-1
2 Internal Control and Cash Internal Control Cash Controls Use of a Bank Reporting Cash The Sarbanes- Oxley Act Principles Limitations Control over cash receipts Control over cash disbursements Making deposits Writing checks Bank statements Reconciling the bank account Cash equivalents Restricted cash Compensating balances 8-2
3 Internal Control Internal control consists of all the related methods and measures adopted within an organization to: 1. Safeguard its assets. 2. Enhance the accuracy and reliability of its accounting records. Reduce risk of: a. Errors (unintentional) b. Irregularities (intentional) Under the Sarbanes-Oxley Act, all publicly traded U.S. corporations are required to maintain an adequate system of internal control. 8-3
4 Internal Control The Sarbanes-Oxley Act Companies must develop sound principles of control over financial reporting. continually verify that controls are working. Independent outside auditors must attest to the level of internal control. SOX created the Public Company Accounting Oversight Board (PCAOB), which now establishes auditing standards and regulates auditor activity. 8-4
5 Internal Control Principles of Internal Control Illustration 8-1 Measures vary with size and nature of the business. management s control philosophy. h There are six principles p apply to most enterprises: 8-5
6 8-6 Internal Control Principles of Internal Control ESTABLISHMENT OF RESPONSIBILITY Control is most effective when only one person is responsible for a given task. SEGREGATION OF DUTIES - Related duties should be assigned to different individuals. - Record keeping separate from physical custody. DOCUMENTATION PROCEDURES Companies should use prenumbered documents and all documents should be accounted for.
7 Internal Control Principles of Internal Control Illustration 8-3 PHYSICAL, MECHANICAL, AND ELECTRONIC CONTROLS Physical Mechanical cal and Electronic 8-7
8 8-8 Internal Control Principles of Internal Control INDEPENDENT INTERNAL VERIFICATION 1. Records periodically or on a surprise basis verified by an employee who is independent. 2. Discrepancies and exceptions should be reported to a management level that can take corrective actions. OTHER CONTROLS 1. Bond employees who handle cash. 2. Rotate employees duties and require employees to take vacations. 3. Conduct thorough h background checks.
9 Internal Control Limitations of Internal Control Costs should not exceed benefit so that internal control generally provides reasonable assurance. Human element should be considered to prevent the impairments of collusion. Size of the business. 8-9
10 Cash Controls Illustration 8-5 Internal Control over Cash Receipts Establishment of Responsibility Only designated d personnel are authorized to handle cash receipts (cashiers) Documentation Procedures Use remittance advice (mail receipts), cash register tapes, and deposit slips Independent Internal Verification Supervisors count cash receipts daily; treasurer compares total receipts to bank deposits daily 8-10 Segregation of Duties Different individuals receive cash, record cash receipts, and hold the cash Physical, Mechanical, and Electronic Controls Store cash in safes and bank vaults; limit access to storage areas; use cash registers Other Controls Bond personnel who handle cash; require employees to take vacations; deposit all cash in bank daily
11 Cash Controls Discussion Question Q At the corner grocery store, all sales clerks make change out of one cash register drawer. Is this a violation of internal control? Why? 8-11
12 Cash Controls Cash consists of coins, currency, checks, money orders, and money on hand or on deposit in a bank. Cash receipts come from: cash sales collections on account from customers receipt of interest, rent, and dividends investments by owners bank loans proceeds from the sale of noncurrent assets 8-12
13 Over-the the-counter Receipts Cashier s Department Sales Department Illustration 8-7 Prepare daily cash summary Prepare deposit slip 8-13 Cashier ring up sales on registers Supervisor 1. reads register totals 2. makes cash counts 3. prepares cash count sheets Bank Treasurer Accounting (deposit) (verification) (record)
14 8-14 Mail Receipts Control Procedures: Mail receipts should be opened by two people, a list prepared, and each check endorsed. Copy of the list, along with the checks and remittance advices, sent to cashier s s department. Cashier adds the checks to the over-the-counter receipts and prepares a daily cash summary and makes the daily bank deposit. Copy of list sent to treasurer s s office for comparison with total shown on daily cash summary.
15 Cash Controls Review Question Permitting only designated personnel to handle cash receipts is an application of the principle of: a. segregation of duties. b. establishment of responsibility. c. independent check. d. other controls. 8-15
16 Cash Controls Internal Control over Cash Disbursements Generally, internal control over cash disbursements is more effective when companies pay by check, rather than by cash. Applications: Voucher system Electronic funds transfers (EFT) system Petty cash fund 8-16
17 Cash Controls Illustration 8-8 Internal Control over Cash Disbursements Establishment of Responsibility Only designated personnel are authorized to sign checks (treasurer) Segregation g of Duties Different individuals approve and make payments; check signers do not record disbursements Documentation Procedures Use prenumbered checks and account for them in sequence; each check must have an approved invoice Other Controls Stamp invoices PAID Independent Internal Verification Compare checks to invoices; reconcile bank statement monthly Physical, Mechanical, and Electronic Controls Store blank checks in safes, with limited access; print check amounts by machine in indelible ink 8-17
18 Cash Controls Review Question The use of prenumbered checks in disbursing cash is an application of the principle of: a. establishment of responsibility. b. segregation of duties. c. physical, mechanical, and electronic controls. d. documentation procedures. 8-18
19 Cash Controls Internal Control over Cash Disbursements Voucher System A network of approvals by authorized individuals, acting independently, to ensure all disbursements by check are proper. A voucher is an authorization ti form prepared for each expenditure. 8-19
20 Cash Controls Internal Control over Cash Disbursements Electronic Funds Transfers (EFT) Disbursement systems that use wire, telephone, or computers to transfer cash balances between locations. Procedures that t companies and banks have developed to transfer funds among parties without the use of paper (deposit slips, checks, etc.) 8-20
21 Cash Controls Internal Control over Cash Disbursements Petty Cash Fund -Used to pay relatively small amounts. The operation of a petty cash fund, often called an imprest system, involves three steps: 1. establishing the fund, 2. making payments from the fund, and 3. replenishing the fund. 8-21
22 Petty Cash Fund Establishing The Fund: A petty cash custodian should be appointed to be responsible for the fund. To establish the fund, a company issues a check payable to the petty cash custodian for the stipulated amount. For example, if Laird Company decides to establish a $100 fund on March 1, the journal entry is: March 1 Petty cash 100 Cash
23 Petty Cash Fund Making Payments from The Fund: The petty cash fund custodian has the authority to make payments from the fund that conform to prescribed management policies. Each payment must be documented on a prenumbered petty cash receipt (or petty cash voucher) attached with other supporting documents such as freight bills or invoices. The fund custodian keeps the receipts in the petty cash box until the fund is replenished. When each payment is made from petty cash, no accounting entry is recorded. d Instead, the accounting effects of each payment are recognized when the petty fund is replenished. 8-23
24 Petty Cash Fund Replenishing the Fund The timing for replenishing the petty fund: 1. When the money in the petty cash fund reaches a minimum level, 2. At the end of the accounting gperiod. Note that the replenishment entry does not affect the Petty Cash account. Occasionally, in replenishing a petty cash fund, the Cash Over and Short account is debited or credited to recognize a cash shortage or overage. 8-24
25 Petty Cash Fund Replenishing the Fund Assume that on March 15 Laird s petty cash custodian requests a check for $88. The fund contains $12 cash and petty cash receipts for postage $44, freight-out $38, and miscellaneous expenses $5. The journal entry to record the check is: March 15 Postage expense 44 Freight-out 38 Miscellaneous expense 5 Cash over and short 1 Cash
26 Petty Cash Fund E8-7 Lincolnville Company uses an imprest petty cash system. The fund was established on March 1 with a balance of $100. During March the following petty cash receipts were found in the petty cash box. Receipt Date No. For Amount 3/5 1 Postage Expense $ Freight-out Miscellaneous expense Travel expense Miscellaneous expense 5 The fund was replenished on March 15 when the fund contained $3 in cash. On March 20, the amount in the fund was increased to $150. Instructions: Journalize the entries in March that pertain to the operation of the petty cash fund. 8-26
27 Petty Cash Fund E8-7 The fund was established on March 1 with a balance of $100 March 1 Petty cash 100 Cash
28 Petty Cash Fund E8-7 The fund was replenished on March 15 when the fund contained $3 in cash. March 15 Postage expense 39 Freight-out 21 Miscellaneous expense 11 Travel expense 24 Cash over and short 2 Cash
29 Petty Cash Fund E8-7 On March 20, the amount in the fund was increased to $150. March 20 Petty cash 50 Cash
30 Use of a Bank Contributes significantly to good internal control over cash. Minimizes the amount of currency on hand. Creates a double record of bank transactions. Bank reconciliation. 8-30
31 Use of a Bank Making Bank Deposits Authorized employee should make deposit. Illustration 8-10 Bank Code Numbers 8-31 Front Side Reverse Side
32 Use of a Bank Writing Checks Illustration 8-11 Written order signed by depositor directing bank to pay a specified sum of money to a designated recipient. Maker Payee Payer 8-32
33 WRITING CHECKS Three parties to a check are: 1 Maker/drawer issues the check 2 Bank/payer py on which check is drawn 3 Payee to whom check is payable 8-33
34 Use of a Bank Bank Statements Illustration 8-12 Debit Memorandum Bank service charge NSF (not sufficient funds) Credit Memorandum Collect notes receivable. Interest earned. 8-34
35 BANK STATEMENTS A bank statement shows: 1 checks paid and other debits charged against the account 2 deposits and other credits made to the account 3 account balance after each day s transactions Debit memorandum indicate charges against the depositor s account. (ATM service charges). Credit memorandum idi indicate amounts that increase the depositor s account. (Interest revenue). 8-35
36 8-36 Use of a Bank Review Question The control features of a bank account do not include: a. having bank auditors verify the correctness of the bank balance per books. b. minimizing the amount of cash that must be kept on hand. c. providing a double record of all bank transactions. ti d. safeguarding cash by using a bank as a depository.
37 RECONCILING THE BANK ACCOUNT Reconciliation is necessary because the balance per bank and balance per books are seldom in agreement due to time lags and errors. Reconciliation should be prepared by an employee who has no other responsibilities pertaining i to cash. 8-37
38 RECONCILING THE BANK ACCOUNT The lack of agreement between the two balances has two causes: 1. Time lags that prevent one of the parties from recording the transaction in the same period as the other party. 2. Errors by either party in recording transactions. 8-38
39 RECONCILING THE BANK ACCOUNT Reconcile balance per books and balance per bank to their adjusted (corrected) cash balances. Reconciling Items: 1. Deposits in transit. 2. Outstanding checks. 3. Errors. 4. Bank memoranda. 8-39
40 RECONCILING THE BANK ACCOUNT Steps in preparing a bank reconciliation: 1. Determine deposits in transit 2D 2. Determine outstanding checks 3. Note any errors discovered 4. Trace bank memoranda to the records Each reconciling item used in determining the adjusted cash balance per books should be recorded by the depositor. 8-40
41 RECONCILING THE BANK ACCOUNT Reconciliation Procedures Illustration Deposit in Transit - Outstanding t Checks +/- Bank Errors CORRECT BALANCE + Notes collected by bank - NSF (bounced) checks - Check printing or other service charges +/- Company Errors CORRECT BALANCE 8-41
42 BANK RECONCILIATION LAIRD COMPANY Bank Reconciliation April 30, 2008 Cash balance per bank statement $ 15, Add: Deposits in transit 2, The bank statement for 18, the Laird Company Less: Outstanding checks shows a balance per No. 453 $ 3, No. 457 bank of $15, on 1, No. 460 April 30, , , Adjusted cash balance per bank $12, Cash balance per books $ 11, Add: Collection of $1,000 note receivable plus interest earned $50, less collection fee $15 $ 1, Error in recording check , , Less: NSF check On this date the Bank service charge balance of cash per Adjusted cash balance per books books is $11, $12,
43 ENTRIES FROM THE BANK RECONCILIATION GENERAL JOURNAL Date Account Titles and Explanation Debit Credit Apr. 30 Cash Miscellaneous Expense 1, Notes Receivable 1, Interest Revenue (To record collection of notes receivable by bank) Collection of Note Receivable. This entry involves four accounts. Interest of $50 has not been accrued and the collection fee is charged to Miscellaneous Expense. 8-43
44 ENTRIES FROM THE BANK RECONCILIATION GENERAL JOURNAL Date Account Titles and Explanation Debit Credit Apr. 30 Cash Accounts Payable Andrea Company (To correct error in recording check No. 443) Book Error. An examination of the cash disbursements journal shows that check No. 443 was a payment on account to Andrea Company, a supplier. The check, with a correct amount of $1,226.00, was recorded at $1,
45 ENTRIES FROM THE BANK RECONCILIATION GENERAL JOURNAL Date Account Titles and Explanation Debit Credit Apr. 30 Accounts Receivable J. R. Baron Cash (To record NSF check) NSF Check An NSF check becomes an accounts receivable to the depositor. 8-45
46 ENTRIES FROM THE BANK RECONCILIATION GENERAL JOURNAL Date Account Titles and Explanation Debit Credit Apr. 30 Miscellaneous Expense Cash (To record charge for printing company checks) Bank Service Charges Check printing charges (DM) and other bank service charges (SC) are debited to Miscellaneous Expense because they are usually nominal in amount. 8-46
47 8-47 RECONCILING THE BANK ACCOUNT E8-9 The following information pertains to Vince s Video Company. 1. Cash balance per bank, July 31, $2, Cash balance per books, July 31, $2, July bank service charge not recorded by the depositor $ Deposits in transit, July 31, $ Bank collected $300 note for Family in July, plus interest $36, less fee $15.The collection has not been recorded by Vince s, and no interest t has been accrued. 6. Outstanding checks, July 31, $207. Instructions a) Prepare a bank reconciliation at July 31. b) Journalize the adjusting entries at July 31 on the books of Vince s Video Company.
48 RECONCILING THE BANK ACCOUNT E8-9 a) Prepare a bank reconciliation at July 31. Cash balance per bank statement $2,542 Add: Deposit in transit 525 Less: Outstanding checks (207) Adjusted cash balance per bank $2,860 Cash balance per books $2,549 Add: Collection of notes receivable 300 Collection of interest 36 Less: Bank service charge (10) Note collection fee (15) Adjusted cash balance per books $2,
49 RECONCILING THE BANK ACCOUNT E8-9 b) Journalize the adjusting entries at July 31 on the books of Vince s Video Company. Dr. Cr. July 31 Cash 311 Bank charge expense 10 Miscellaneous expense 15 Notes receivable 300 Interest revenue 36 Note: Adjusting journal entry includes only the adjustments to the cash balance per books. 8-49
50 RECONCILING THE BANK ACCOUNT Review Question The reconciling item in a bank reconciliation that will result in an adjusting entry by the depositor is: a. outstanding checks. b. deposit in transit. c. a bank error. d. bank service charges. 8-50
51 Reporting Cash Most liquid asset, listed first in current assets section of balance sheet. Illustration 8-16 Cash equivalents Restricted cash Compensating balances 8-51
52 8-52 Use of a Bank Review Question Which of the following statements correctly describes the reporting of cash? a. Cash cannot be combined with cash equivalents. b. Restricted cash funds may be combined with Cash. c. Cash is listed first in the current assets section. d. Restricted cash funds cannot be reported as a current asset.
Chapter 7 Fraud, Internal Control, and Cash 高立翰
Chapter 7 Fraud, Internal Control, and Cash 高立翰 Study Objectives 1. Define fraud and internal control. 2. Identify the principles of internal control activities. 3. Explain the applications of internal
More informationInternal Control and Cash
Accounting Principles, 7 th Edition Weygandt Kieso Kimmel Chapter 8 Internal Control and Cash Prepared by Naomi Karolinski Monroe Community College and Marianne Bradford Bryant College John Wiley & Sons,
More informationIntroduction to Accounting 2 Modul 1 Internal Control and Cash
Introduction to Accounting 2 Modul 1 Internal Control and Cash After studying this chapter, you should be able to: 1. Describe the Sarbanes-Oxley Act of 2002 and its impact on internal controls and financial
More informationFraud, Internal Control, and Cash
Chapter 7 Fraud, Internal Control, and Cash 7-1 Learning Objectives After studying this chapter, you should be able to: 1. Define fraud ( 欺 騙 ) and internal control ( 內 部 控 制 ). 2. Identify the principles
More informationInternal Control and Cash. Study Objectives. Chapter Outline
Study Objectives Identify the principles of internal control. Explain the applications of internal control to cash receipts. Explain the applications of internal control to cash disbursements. Prepare
More informationCOUNTY OF TRINITY CASH HANDLING PROCEDURES
COUNTY OF TRINITY CASH HANDLING PROCEDURES Prepared by the Trinity County Auditor/Controller s Office Revised October 1, 2009 TABLE OF CONTENTS I. Introduction--------------------------------------------------------------------1
More informationAccounting for Cash. College Accounting. Heintz & Parry CASH INTERNAL CONTROL OPENING A CHECKING ACCOUNT
Heintz & Parry 0 th Edition Chapter 0 th Edition College Accounting Accounting for Cash CASH INTERNAL CONTROL Includes: Currency, coins, and checking accounts Checks received from customers Money orders
More information8-1. Prepared by Coby Harmon University of California, Santa Barbara Westmont College
8-1 Prepared by Coby Harmon University of California, Santa Barbara Westmont College 8 Fraud, Internal Control, and Cash Learning Objectives After studying this chapter, you should be able to: [1] Define
More informationFraud, Internal Control, and Cash
Prepared by Coby Harmon University of California, Santa Barbara Westmont College 8-1 8 Fraud, Internal Control, and Cash Learning Objectives After studying this chapter, you should be able to: [1] Define
More informationCaused By 1. Time. 2. Errors. lags $ XXX. but not by bank (e.g., deposits. Add: Deposits recorded by business. Cash balance per bank statement
ILLUSTRATION 8-5 BANK RECONCILIATION FORMAT Balances Should Agree Bank Reconciliation (Date) balance per bank statement Add: Deposits recorded by business but not by bank (e.g., deposits in transit) Less:Charges
More informationCHAPTER 7. Fraud, Internal Control, and Cash 5, 6, 7, 8, 9, 10, 11 6, 13, 14, 15 16, 17, 18, 19 11, 12 13, 14
CHAPTER 7 Fraud, Internal Control, and Cash ASSIGNMENT CLASSIFICATION TABLE Learning Objectives Questions Brief Exercises Do It! Exercises A Problems B Problems 1. Define fraud and internal control. 1,
More informationMonitoring of controls Information System Control procedures
Chapter 7 Define internal control Organizational plan and all the related measures to: Congress passed SOX after the Enron and WorldCom scandals 3 4 6 Monitoring of controls Information System Control
More informationFinancial Accounting. John J. Wild. Sixth Edition. McGraw-Hill/Irwin. Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Financial Accounting John J. Wild Sixth Edition McGraw-Hill/Irwin Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 06 Reporting and Analyzing Cash and Internal Controls Conceptual
More informationCHAPTER 7 - SARBANES-OXLEY, INTERNAL CONTROL, CASH. Material Copyright- Protected: Janice Stoudemire and Barbara wagers
CHAPTER 7 - SARBANES-OXLEY, INTERNAL CONTROL, CASH Material Copyright- Protected: Janice Stoudemire and Barbara wagers Chapter 7 SARBANES-OXLEY, INTERNAL CONTROL, CASH Learning Objectives 1. Sarbanes-Oxley
More informationASSOCIATED STUDENTS, INCORPORATED CALIFORNIA STATE UNIVERSITY, LONG BEACH DATE REVISED: 04/10/2013
Cash Handling BACKGROUND AND PURPOSE...1 POLICY STATEMENT...2 WHO SHOULD KNOW THIS POLICY...2 DEFINITIONS...2 STANDARDS AND PROCEDURES...3 1.0 CONDITIONS FOR EMPLOYMENT IN CASH HANDLING ENVIRONMENT...3
More informationChapter 7 Internal Control, Managing Cash, and Making Ethical Judgments 503
Chapter 7 Internal Control, Managing Cash, and Making Ethical Judgments 7 Questions 1. Safeguarding assets is the most fundamental internal control feature because the entity must safeguard its assets
More informationCash Handling Questionnaire
Cash Handling Questionnaire Internal Control Questionnaire Question Yes No N/A Remarks Because of the relatively high risk associated with transactions involving cash, universities should have a cash management
More informationFundamentals of Financial Accounting
Fundamentals of Financial Accounting CHAPTER I Accounting in action. What is accounting? Accounting is the recording of financial transactions plus storing, sorting, retrieving, summarizing, and presenting
More informationCash, Petty Cash, Change Funds, and Credit Cards
CASH As public servants, it is our responsibility to safeguard taxpayer s dollars while adhering to laws and regulations governing processes over cash handling. Internal controls over cash are necessary
More informationPOLICY & PROCEDURE DOCUMENT NUMBER: 3.3011. DIVISION: Finance & Administration. TITLE: Cash Operations Policy and Procedures. DATE: July 15, 2011
POLICY & PROCEDURE DOCUMENT NUMBER: 3.3011 DIVISION: Finance & Administration TITLE: Cash Operations Policy and Procedures DATE: July 15, 2011 Authorized by: K. Ann Mead, VP for Finance & Administration
More informationAgenda. Lecture Chapter 9 Quiz Chapter 8 Exercises & Problem Chapter 8. Objective. Cash Receipts. Cash Receipts, Payments, & Banking Procedures
Cash Receipts, Payments, & Banking Procedures Agenda Lecture Chapter 9 Quiz Chapter 8 Exercises & Problem Chapter 8 Cash Receipts, Payments, & Banking Procedures Objective Cash Receipts 1.cash receipts
More informationCHAPTER 9 CASH. Chapter 9. Copyright 2012 The McGraw-Hill Companies, Inc. All rights reserved.
CHAPTER 9 CASH Chapter Opener: Thinking Critically Office expenditures may include petty cash disbursements for office supplies and postage. Cash expenditures might also include payments for rent and utilities.
More informationThe policy and procedural guidelines contained in this handbook are designed to:
BASIC POLICY STATEMENT The Mikva Challenge is committed to responsible financial management. The entire organization including the board of directors, administrators, and staff will work together to make
More informationControlling and Reporting Cash
Controlling and Reporting Cash Essential Principles for Safeguarding Cash and Reporting It On Financial Statements Gregory Mostyn, CPA Worthy and James Publishing www.worthyjames.com Controlling and Reporting
More informationPitt County Schools Individual School Accounting. Internal Controls and Responsibilities Fiscal Year 2009-10
Individual School Accounting Internal Controls and Responsibilities Fiscal Year 2009-10 Individual School Accounting Internal Controls and Responsibilities Fiscal Year 2009-10 Contents Page Principal Statement
More informationChapter 9. Learning Objectives. Define internal control. Objective 1. Internal Control and Cash
PowerPoint to accompany Chapter 9 Internal Control and Cash Learning Objectives 1. Define internal control 2. Describe good internal control procedures 3. Prepare a bank reconciliation and the related
More informationAAM 50. CASH. AAM 50.010 Treasury Investment (10-09)
AAM 50. CASH 50.010 Treasury Investment 10/09 50.020 Accountability 10/09 50.030 Control 10/09 50.040 Receipt for Payments 10/09 50.050 Daily Record of Collections 10/09 50.060 Mail Collections 50.070
More informationTOWN OF CARLYLE POLICY MANUAL
TOWN OF CARLYLE POLICY MANUAL POLICY DESCRIPTION: POLICY NUMBER: IAC 0010 Internal Accounting Controls DATE APPROVED: March 26, 2008 DATE REVISED: October 12, 2011 Purpose of Policy: To promote and protect
More informationCEBU CPAR CENTER M a n d a u e C I t y
1 of 11 CEBU CPAR CENTER M a n d a u e C I t y AUDITING PROBLEMS AUDIT OF CASH AND CASH EQUIVALENTS PROBLEM NO. 1 You were able to gather the following from the December 31, 2005 trial balance of Peso
More informationUnit 2 The Basic Accounting Cycle
Unit 2 The Basic Accounting Cycle Chapter 3 Chapter 4 Chapter 5 Chapter 6 Chapter 7 Chapter 8 Chapter 9 Business Transactions and the Accounting Equation Transactions That Affect Assets, Liabilities, and
More informationADMINISTRATIVE PRACTICE LETTER
ADMINISTRATIVE PRACTICE LETTER SUBJECT: PETTY CASH Section I - E Issue 6 Page 1 of 2 Effective 7/10/07 GENERAL Each petty cash fund is in the sole custody of a business manager who is responsible to the
More informationFS-06-SF3 School Funds Receipt Log; FS-04-SF2 Schools Funds Payment Request; FS-04-SF1 School Funds: Advance of Funds
Administrative SCHOOL FUNDS Responsibility: Legal References: Related References: Executive Superintendent of Business Services Nil FS-04-SF4 School Funds: Receipts; FS-06-SF3 School Funds Receipt Log;
More informationVance County Schools Individual School Accounting
Individual School Accounting Internal Controls and Responsibilities Individual School Accounting Internal Controls and Responsibilities Contents Page Principal Statement of Understanding 3 Treasurer Statement
More information2. Is the mail log prepared by someone who does not participate in any other aspects of the revenue receipts process?
CASH AND CHECK HANDLING SELF ASSESSMENT Because of the relatively high risk associated with transactions involving cash, universities need to have a cash management program to safeguard cash and ensure
More informationCash Receipts, Cash Payments, and Banking Procedures
9-1 McGraw-Hill 2009 The McGraw-Hill Companies, Inc. All rights reserved. Cash Receipts, Cash Payments, and Banking Procedures Section 1: Cash Receipts Section Objectives 1. Record cash receipts in a cash
More informationIthaca College Accepting Cash and Checks Procedures
Ithaca College Accepting Cash and Checks Procedures I. Procedure Statement To minimize institutional risk, Ithaca College discourages individual departments from accepting cash and checks on its behalf.
More informationBUSINESS SERVICES DIVISION PROCEDURES MANUAL REVISED DATE 08/13 CASH HANDLING
BUSINESS SERVICES DIVISION PROCEDURES MANUAL CASH HANDLING REVISED DATE 08/13 When handling money, internal controls ensure resources are guarded against waste, loss, and misuse. Basic principles of internal
More informationINTERNAL ACCOUNTING CONTROLS CHECKLIST FOR NTMA CHAPTERS
P R E C I S I O N INTERNAL ACCOUNTING CONTROLS CHECKLIST FOR NTMA CHAPTERS Presented at NTMA 2004 Annual Convention Palm Springs, CA February 2004 National Tooling & Machining Association 9300 Livingston
More informationFINANCE COMMITTEE PROCEDURES. Audit Process. Cash Handling
1 FINANCE COMMITTEE PROCEDURES Audit Process 1. Internal audits are conducted once a year. 2. The bookkeeper will provide the following information: bank statements, prior year vouchers, and access to
More informationControlling and Reporting Cash
Controlling and Reporting Cash Essential Principles for Safeguarding Cash and Reporting It On Financial Statements Gregory Mostyn, CPA Worthy and James Publishing www.worthyjames.com Controlling and Reporting
More informationEquity The remainder is the shareholders claim on the assets-equity. It is often referred to as residual equity.
ACT 1600 Fundamental of Financial Accounting Chapter 1 The Basic Accounting Equation Asset = Liabilities + Equity Asset Assets are resources a business owns. The common characteristic possessed by all
More informationUCLA Policy 360: Internal Control Guidelines for Campus Departments
UCLA Policy 360: Internal Control Guidelines for Campus Departments Issuing Officer: Assistant Vice Chancellor, Corporate Financial Services Responsible Dept: Financial Management Programs Effective Date:
More informationLOCAL TRAINING INITIATIVE
Training Standards System LOCAL TRAINING INITIATIVE BOOKS OF ACCOUNT AND RECORD KEEPING Best Practice Guidelines Page 1 of 13 The LTI must comply with public procurement guidelines when purchasing goods
More informationChapter Five: Cash Receipts
Chapter Five: Cash Receipts A. Policies Overview In order to maintain good controls over accounting, the Central Office is responsible for depositing all cash and checks into the operating account. Cash
More information1501 BANKING RELATIONSHIPS
1501 BANKING RELATIONSHIPS Effective: December 1986 Revised: May 2013 Responsible Office: Treasurer Approval: Treasurer The Vice President for Finance and Treasurer is responsible for the efficient operations
More informationCOUNTY OF MENDOCINO CASH CONTROL AND ACCOUNTING STANDARD PRACTICE MANUAL F O R E W O R D
F O R E W O R D This Manual has been developed to provide basic guidance and to standardize operating procedures for all phases of handling cash. The policies and procedures contained in the Manual are
More informationAudit Guidelines. The Annual Church Audit. by Dan Busby. Key Concepts. Idea! Use this document as a checklist for your annual audit.
The Annual Church Audit by Dan Busby Audit Guidelines Church board members have a long list of responsibilities. Among these is the responsibility for the money that flows through the church. Included
More informationCash Operations Manual - Cash Receipts
A. DEFINITION OF CASH Cash Operations Manual - Cash Receipts The term "cash" as used in this manual, refers to U.S. currency and coin, checks drawn on U.S. banks and written in U.S. dollar values (including
More information5:31-7 Appendix B LOCAL AUTHORITIES - ACCOUNTING AND AUDITING IF ANY ARE NOT APPLICABLE, INSERT N/A AS YOUR ANSWER. FIRE DISTRICT YEAR UNDER AUDIT
5:31-7 Appendix B LOCAL AUTHORITIES - ACCOUNTING AND AUDITING AUDIT QUESTIONNAIRE FOR FIRE DISTRICT AUDITS EACH QUESTION MUST BE ANSWERED. PLEASE CIRCLE YES OR NO. IF ANY ARE NOT APPLICABLE, INSERT N/A
More informationBest Practices for Cash Control
Best Practices for Cash Control The procedures listed below are a list of best practices to accept, store, reconcile and deposit, document, and transport deposits, for cash, checks and payment cards. There
More informationTHE CITY OF NEW YORK OFFICE OF THE COMPTROLLER INTERNAL CONTROL AND ACCOUNTABILITY DIRECTIVES
THE CITY OF NEW YORK OFFICE OF THE COMPTROLLER INTERNAL CONTROL AND ACCOUNTABILITY DIRECTIVES DIRECTIVE 11 - CASH ACCOUNTABILITY AND CONTROL INTRODUCTION AND SUMMARY The purpose of this Directive is to
More informationCASH RECONCILIATION & INTERNAL CONTROLS
CASH RECONCILIATION & INTERNAL CONTROLS Montana Clerks, Treasurers & Finance Officers Institute ~ May 2011 Presented by: Brenda Schneider, Superior; Doris Pinkerton, Forsyth & Darla Erickson, Local Government
More informationDepartment of Sociology Cash Handling Procedures Fiscal Year 2016
Department of Sociology Cash Handling Procedures Fiscal Year 2016 I. PURPOSE AND OVERVIEW In accordance with MAPP 05.01.01, Cash Handling, all cash transactions involving the University, its colleges,
More informationTo the Rector, Wardens and Vestry of (Church Name; Church Address; City and Zip)
Section B. Sample Audit Committee Certificate Date To the Rector, Wardens and Vestry of (Church Name; Church Address; City and Zip) Subject: (Audit Year) Audit of (Church Name) We have inspected the statement
More informationCR-370 CASH RECEIPTS
CR-370 CASH RECEIPTS 370.1 UNIT DEPOSITING PROCEDURES 370.2 GENERAL INTERNAL POLICIES RELATING TO THE CASHIER 370.3 TIMELY DEPOSITS 370.4 COUNTING THE ENTERPRISE UNIT DEPOSIT 370.5 PREPARING THE BANK DEPOSIT
More informationCONCEPTS FOR REVIEW INTERNAL CONTROL AND CASH
INTERNAL CONTROL AND CASH THE NAVIGATOR Understand Concepts for Review Read Feature Story Scan Study Objectives Read Preview Read text and answer Before You Go On p. 296 p. 301 p. 309 Work Demonstration
More informationSUMMARY OF CORRECTIVE ACTION FOR SEGREGATION OF DUTIES AUDIT ISSUES
SUMMARY OF CORRECTIVE ACTION FOR SEGREGATION OF DUTIES AUDIT ISSUES CASH MANAGEMENT I. Checks a. All checks are restrictively endorsed, using the endorsement stamp maintained by the building secretary.
More informationCASH HANDLING & DEPOSIT GUIDE TEXAS STATE UNIVERSITY STUDENT BUSINESS SERVICES
CASH HANDLING & DEPOSIT GUIDE TEXAS STATE UNIVERSITY STUDENT BUSINESS SERVICES General Overview UPPS 03.01.05 establishes requirements and procedures for the collection and recording of university income,
More informationBEDFORD PUBLIC SCHOOLS BUSINESS OFFICE PROCEDURES MANUAL
BEDFORD PUBLIC SCHOOLS BUSINESS OFFICE PROCEDURES MANUAL Revised 3-27-2014 TABLE OF CONTENTS Section 1: Section 2: Section 3: Section 4: Section 5: Section 6: Section 7: Section 8: Section 9: Cash Management
More informationAPPENDIX A DRAFT Policy DIE-1 School Funds: Audit & Financial Monitoring Procedures
APPENDIX A DRAFT Policy DIE-1 School Funds: Audit & Financial Monitoring Procedures Administrative Guidelines Financial Monitoring Procedures The following Administrative Guidelines support the Principal
More informationChapter 15 Auditing the Expenditure Cycle
Chapter 15 Auditing the Expenditure Cycle Expenditure cycle consists of activities related to the acquisition of and payment for plant assets and goods and services. Two major transaction classes: 1 purchases
More informationCASH HANDLING POLICY
COUNTY OF SAN LUIS OBISPO OFFICE OF THE AUDITOR-CONTROLLER CASH HANDLING POLICY Revised September 22, 2008 COUNTY OF SAN LUIS OBISPO OFFICE OF THE AUDITOR-CONTROLLER CASH HANDLING POLICY FORWARD This manual
More informationUNT Cash Control and Departmental Deposit Handbook
UNT Cash Control and Departmental Deposit Handbook University of North Texas January 2014 Volume 2, Issue 1 STUDENT ACCOUNTING & UNIVERSITY CASHIERING SERVICES Table of Contents General Overview...1 Proper
More informationWALLA WALLA PUBLIC SCHOOLS ACCOUNTING GUIDELINES
Walla Walla Walla Public Schools Business Office 364 South Park Street Walla Walla WA 99362-3249 FAX (509) 529-7713 (509) 527-3000 WALLA WALLA PUBLIC SCHOOLS ACCOUNTING GUIDELINES Table of Contents I.
More informationDeposit of Cash Receipts
Deposit of Cash Receipts Table of Contents 01. Policy Statement... 2 02. Reason for Policy... 2 03. Who Needs to Know This Policy... 2 04. Bonding Requirements... 2 05. Definitions... 2 06. Lockboxes and
More informationCHAPTER VIII ACCOUNTING POSTING RECORDS - SETTLEMENT WITH THE COUNTY - CLOSING THE BOOKS - RECONCILING DEPOSITORY BALANCES
8-1 CHAPTER VIII ACCOUNTING POSTING RECORDS - SETTLEMENT WITH THE COUNTY - CLOSING THE BOOKS - RECONCILING DEPOSITORY BALANCES RECONCILING CASH WITH RECEIPTS AT THE CLOSE OF THE DAY As soon as the office
More informationTABLE OF CONTENTS CHAPTER 9
TABLE OF CONTENTS CHAPTER 9 Purpose...1 Balance Sheet Accounts...1 Assets...1 Cash...1 Accounts Receivable...2 Accounts Receivable Allowances...4 Loans and Notes Receivable...4 Loans and Notes Allowances...5
More informationInternal Controls and Political Committees
Internal Controls and Political Committees Under the Federal Election Campaign Act (FECA) and the Commission s regulations all political committees are required to file accurate and complete disclosure
More informationAll campus departments and any employee receiving cash and cash equivalent payments will be affected.
ADMINISTRATIVE RULE NO: 5020-02 RELATED TO POLICY SERIES NO: 5020 TITLE: CASH AND CASH EQUIVALENT HANDLING PROCEDURES CASH HANDLING GENERAL POLICY A. Purpose Provide direction for campus departments and
More informationACCOUNTING FOR REVENUE
CHAPTER 4 ACCOUNTING FOR REVENUE SCOPE This chapter provides information on the laws, approved forms, reports, and procedures used in the accounting for revenue received by state agencies. Specific instructions
More informationSAMPLE FINANCIAL PROCEDURES MANUAL
SAMPLE FINANCIAL PROCEDURES MANUAL Approved by (organization s) Board of Directors on (date) I. GENERAL 1. The Board of Directors formulates financial policies, delegates administration of the financial
More informationFINANCIAL CONTROLS POLICIES AND PROCEDURES FOR SMALL NONPROFIT ORGANIZATIONS
By Cindy Cumfer NOTE: These policies and procedures are designed for small nonprofits that do not have an administrator with financial expertise. They are set up to divide the fiscal control roles between
More informationPrinciplesofAccounting HelpLesson #6 Accounting for Petty Cash and Cash Short and Over
PrinciplesofAccounting HelpLesson #6 Accounting for Petty Cash and Cash Short and Over By Laurie L. Swanson Click the button below to navigate to the next slide. Cash is one of the most important assets
More informationStandard Procedures and Controls for the Title Industry. Prepared by the ALTA Internal Auditing Committee ALTA
Standard Procedures and Controls for the Title Industry Prepared by the ALTA Internal Auditing Committee ALTA The American Land Title Association, founded in 1907, is the national trade association and
More informationDISCUSSION QUESTIONS. Suggested Responses
DISCUSSION QUESTIONS Suggested Responses 1. The signature card provides the bank with a copy of the official signature(s) of the person or persons authorized to sign checks. The bank can use it to verify
More informationSKAGIT COUNTY CASH COLLECTION POLICIES
SKAGIT COUNTY CASH COLLECTION POLICIES Administered by the Skagit County Treasurer Revised June 8, 2004 TABLE OF CONTENTS Policy Page I. Mandatory training for Cash Handlers 3 II. Temporary Employees as
More informationTOPIC NO. 20330 TOPIC PETTY CASH December 2008 Table of Contents
Table of Contents Overview... 3 Introduction... 3 Policy... 3 Non-Routine Purchasing... 3 Routine Purchasing... 3 Small Purchases Charge Card... 3 Use of EDI for Repayment... 3 Definitions... 4 Change
More informationGRAP Implementation Guide for Municipalities
GRAP Implementation Guide for Municipalities TOPIC 2.3: BANK ACCOUNTS AND CASH This section of the manual sets out the FSOP s that need to be executed by the municipality regarding Bank Balances and Cash.
More informationCANI Financial Policy and Procedures
CANI Financial Policy and Procedures Policy CANI Council is conscious of the need to ensure that all funds received by the organisation are used in accordance with the aims and objectives of CANI; that
More informationChapter 18 Auditing Investments and Cash Balances
Chapter 18 Auditing Investments and Cash Balances General Considerations Cash balances include undeposited receipts on hand, cash in bank in unrestricted accounts, and imprest accounts such as petty cash
More informationCOMMUNITY EDUCATION Department Summary Transactions Summary Internal Controls of Cash Receipts
COMMUNITY EDUCATION Department Summary Community Education provides quality programs and services for more than 25,000 residents of our community and beyond each year. Programs include Adult Education
More informationInternal Controls over Cash for Small Nonprofits
Internal Controls over Cash for Small Nonprofits Internal controls may be a sensitive issue in small nonprofit organizations. These organizations are built on the concepts of honesty, truthfulness, and
More informationOFFICIAL CASH HANDLING PROCEDURES FOR DEPARTMENTS, STUDENT FINANCIAL SERVICES, AND ACCOUNTING
Last Updated 7/15/15 OFFICIAL CASH HANDLING PROCEDURES FOR DEPARTMENTS, STUDENT FINANCIAL SERVICES, AND ACCOUNTING To be in compliance with the Cash Handling and Deposits Policy, Departments must also
More informationABC Division Cash Handling Procedures Fiscal Year 20XX
ABC Division Cash Handling Procedures Fiscal Year 20XX I. PURPOSE AND OVERVIEW In accordance with MAPP 05.01.01, Cash Handling, all cash transactions involving the University, its colleges, or any departments
More informationAccounting software & data
Accounting software & data Accounting software and data should reside at church or be webbased where the data base can be accessed by multiple users Multiple people should be trained on software Software
More informationCASH HANDLING AND REPORTING
CASH HANDLING AND REPORTING A. Purpose The purpose of this policy is to outline procedures for the consistent cash management at The University of Texas Rio Grande Valley (UTRGV). B. Persons Affected This
More informationACCOUNTING POLICIES AND PROCEDURES SAMPLE MANUAL
(Name of Organization & logo) ACCOUNTING POLICIES AND PROCEDURES SAMPLE MANUAL (Date) Note: this sample manual is designed for nonprofit organizations with the following staff involved with accounting
More informationInternal Control Requirements December 11, 2002
1 Internal Control Requirements December 11, 2002 Internal controls are mechanisms, policies, and procedures used to minimize and monitor operational risks. In order to deter employees and/or members from
More informationCj Debit Bank Sen!~ Charge Ei<pense $60 and ct edit Cesh $60. Cj Debit cash $100 and Cfedit Note Receivable $100.
The bank reconciliation of XYZ Co. is provided below. Demonstrate the entries needed to update the cash account in the general Jedger by selecting the correct answers belo\v XYZCo. Bank Reconciliation
More informationChecking and Banking
Chapter 5 Checking and Banking 5.1 Checking Accounts 5.2 Banking Services and Fees Lesson 5.1 Checking Accounts Learning Objectives LO 1-1 Describe the purpose of a checking account and the forms associated
More informationCHAPTER 9 Information Unique to Each Fund
CHAPTER 9 Information Unique to Each Fund Table of Contents Section - Page INTRODUCTION 1 1 THE GENERAL FUND 2 1 ASSOCIATED STUDENT BODY FUND (ASB) 3 1 Introduction...1 Accounting Methods and Procedures...2
More informationCASH: CASH CONTROLS C-173 ACCOUNTING MANUAL Page 1. Contents. I. Introduction 2. II. General Description of Cash Operations 2
ACCOUNTING MANUAL Page 1 CASH: CASH CONTROLS Contents I. Introduction 2 II. General Description of Cash Operations 2 III. Bank Account Controls 3 A. Regulations Governing Bank Accounts 3 B. Establishment
More informationAccounting. Chapter 6
Accounting Chapter 6 Lesson 6-1 Money is referred to as cash in accounting Check Checking account When open a checking account sign a signature card for all people who are allowed to sign checks Deposit
More informationCash Receipt and Banking Internal Controls
Chapter 4 Cash Receipt and Banking Internal Controls A major asset of parishes is its cash and cash equivalents, including marketable securities and other highly liquid assets readily convertible into
More informationImplementation Date: Revised: 4/2005 TABLE OF CONTENTS INTRODUCTION 2 ESTABLISHING CASH COLLECTION DEPARTMENT APPROVAL 3
TABLE OF CONTENTS INTRODUCTION 2 ESTABLISHING CASH COLLECTION DEPARTMENT APPROVAL 3 RECEIPT AND COLLECTION OF CASH 5 Cash Handling Requirements Check Acceptance Methods of Recording Cash Receipts Reconciliation
More informationCash & Check Handling Policy
Cash & Check Handling Policy Effective Date: October 27, 2006 Revised Date: October 31, 2011 Policy Statement This policy sets requirements for the collection and secure processing of coin, currency, checks,
More informationCASH RECONCILIATIONS ~ RELATED INTERNAL CONTROLS & TRACKING DEBITS & CREDITS
CASH RECONCILIATIONS ~ RELATED INTERNAL CONTROLS & TRACKING DEBITS & CREDITS THROUGHOUT THE MONTH Montana Clerks, Treasurers & Finance Officers Institute ~ May 2014 Darla Erickson, Local Government Services
More informationACCOUNTING POLICY AND PROCEDURE MANUAL
ACCOUNTING POLICY AND PROCEDURE MANUAL For (CHURCH NAME) ADOPTED ON DATE: Date NOTE: This manual is a template for you to use to establish your polices. Fill in applicable data as needed. Prior to sending
More informationHow To Manage A Corporation
Western Climate Initiative, Inc. Accounting Policies and Procedures Adopted May 8, 2013 WESTERN CLIMATE INITIATIVE, INC ACCOUNTING POLICIES AND PROCEDURES Adopted May 8, 2013 Table of Contents I. Introduction...
More informationDraft Version 12 of working document
A. Guarantee that all donations collected by the ushers are delivered intact (as collected) to the count team by supplying pre-numbered tamper resistant bags. The donations are consolidated into one sealed
More information