The following control procedures are used in Hilga’s Boutique Shoppe for cash disbursements:

1. Each week Hilga leaves 100 comipany, checks in an unmarked envelope on a shelf behind the cash register.

. The store manager personally ; approves all payments before signing and issuing checks.

. The company checks are unnumbered.

. After payment, bills are “filed” in a paid invoice folder.

. The company accountant prepares the bank reconciliation and reports any discrepancies to the owner.

Om NYB&W Instructions

(a) For each procedure, explain the weakness in internal control and identify the internal control principle that is violated.

(b) For each weakness, suggest a change in the procedure that will result in good internal control.