Imagine That You Are an Account Executive for a Large Advertising Agency

Internal Cash Control

By:   Steven Carter
University of Phoenix/Axia College

Internal Cash Control has many responsibilities in a business and when it comes to maintaining a business’s cash, everyone has to play their part in order for it to be effective and profitable to the company.   In the first scenario, the questions that were asked was to list the weaknesses in internal control over cash disbursements and to write a memo indicating your recommendations for improving company procedures.   The answer to the first question would be to separate the functions of internal control with authorization, recording and custody of assets.   Any department that has more than one of these abilities causes a weakness in control.   The point of this is to prevent fraudulent activity that could be committed by any one person who had the power to do all three. I recommend that Idaho Company ought to immediately order pre-numbered checks. If this does not happen, checks can be taken plus not accounted for because there is no numbering sequence. Next,   one person will be entrusted with the key to the cabinet in which the unissued checks are kept. Also asap, each check will need two signatures. Both the purchasing agent plus the treasurer will confirm the accuracy of seller bills previous to payment. They will then again be verified by a third worker. After the triple verification method, checks will be issued plus they both will match the amount of the checks to the amount of the invoices. After the treasurer reviews the checking account, the purchasing agent plus a third worker ought to be able to confirm that the treasurer has not missed any amounts plus that the review process is right. Not only ought invoices be stamped as paid, but the date they were paid along with the check numbers plus authorizing names ought to be recorded.

When evaluating the Guard dog Company, I found that all of the five basic principles for funds (cash) management were being used to...