As a new auditor for the CPA firm of Ticke and Tie, you have been assigned to review the internal controls over mail cash receipts of Perso Company. Your review reveals that checks are promptly endorsed “For Deposit Only,” but no list of the checks is prepared by the person opening the mail. The mail is opened either by the cashier or by the employee who maintains the accounts receivable records. Mail receipts are deposited in the bank weekly by the cashier.
Instructions
Write a letter to S. A. Davis, owner of the Perso Company, explaining the weaknesses in internal control and your recommendations for improving the system.