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Internal Cash Control

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I need assistance with the attached document. In 500 words or more, I need to complete the questions pertaining to internal cash control and cash management.

1.
At Idaho Company checks are not prenumbered because both the purchasing agent
and the treasurer are authorized to issue checks. Each signer has access to unissued
checks kept in an unlocked file cabinet. The purchasing agent pays all bills pertaining to
goods purchased for resale. Prior to payment, the purchasing agent determines that the
goods have been received and verifies the mathematical accuracy of the vendor's invoice.
After payment, the invoice is filed by vendor and the purchasing agent records the payment
in the cash disbursements journal. The treasurer pays all other bills following approval
by authorized employees. After payment, the treasurer stamps all bills "paid," files
them by payment date, and records the checks in the cash disbursements journal. Idaho
Company maintains one checking account that is reconciled by the treasurer.

Instructions
(a) List the weaknesses in internal control over cash disbursements.
(b) Write a memo indicating your recommendations for improving company
procedures.

2.

Guard Dog Company recently changed its system of internal control over cash
disbursements. The system includes the following features. Instead of being unnumbered and manually prepared, all checks must now be prenumbered and written by using the new checkwriter purchased by the company. Before a check can be issued, each invoice must have the approval of Jane Bell, the purchasing agent, and Dennis Kurt, the receiving department supervisor. Checks must be signed by either Tom Kimball, the treasurer, or Karen Thews, the assistant treasurer. Before signing a check, the signer is expected to compare the amounts of the check with the amounts on the invoice. After signing a check, the signer stamps the invoice "paid" and inserts within the stamp, the date, check number, and amount of the check. The "paid" invoice is then sent to the accounting department for recording. Blank checks are stored in a safe in the treasurer's office. The combination to the safe is known by only the treasurer and assistant treasurer. Each month the bank statement is reconciled with the bank balance per books by the assistant chief accountant.

Instructions
Identify the internal control principles and their application to cash disbursements of
Guard Dog Company.

3.

The board of trustees of a local church is concerned about the internal accounting
controls pertaining to the offering collections made at weekly services. They ask you to
serve on a three-person audit team with the internal auditor of the university and a CPA
who has just joined the church. At a meeting of the audit team and the board of trustees
you learn the following.

1. The church's board of trustees has delegated responsibility for the financial management
and audit of the financial records to the finance committee. This group prepares
the annual budget and approves major disbursements but is not involved in collections
or recordkeeping. No audit has been made in recent years because the same
trusted employee has kept church records and served as financial secretary for 15
years. The church does not carry any fidelity insurance.

2. The collection at the weekly service is taken by a team of ushers who volunteer to
serve for 1 month. The ushers take the collection plates to a basement office at the
rear of the church. They hand their plates to the head usher and return to the church
service. After all plates have been turned in, the head usher counts the cash received.
The head usher then places the cash in the church safe along with a notation of the
amount counted. The head usher volunteers to serve for 3 months.

3. The next morning the financial secretary opens the safe and recounts the collection.
The secretary withholds $150-$200 in cash, depending on the cash expenditures expected
for the week, and deposits the remainder of the collections in the bank. To facilitate
the deposit, church members who contribute by check are asked to make their
checks payable to "Cash."
4. Each month the financial secretary reconciles the bank statement and submits a copy
of the reconciliation to the board of trustees. The reconciliations have rarely contained
any bank errors and have never shown any errors per books.

Instructions
(a) Indicate the weaknesses in internal accounting control in the handling of collections.
(b) List the improvements 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, and (4) the finance committee.
(c) What church policies should be changed to improve internal control?

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