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AUDB313 TUTORIAL 15 (31. )As the auditor of Ng Kong Enterprises Bhd, you have been asked by your audit supervisor to review the internal control
AUDB313 TUTORIAL 15 (31. )As the auditor of Ng Kong Enterprises Bhd, you have been asked by your audit supervisor to review the internal control system relating to cash receipts. Your review reveals the following procedures are currently being used for handling cash receipts. Mail is opened each morning by the mailroom clerk. Cheques and remittance advices are then forwarded direct to the cashier, who completes a cash analysis form showing customer name, account number and amount received. 361 The cashier also assists the sales clerk with over-the-counter sales during peak periods. All cash sales are recorded on a cash register. At the end of the day, the cash is counted by the sales clerk and handed over to the cashier, who signs on a two-part form, acknowledging receipt of cash. One part is retained by the sales clerk and the other part goes to the cashier with the cash. Depending on the amount of cash and cheques received each day the cashier either prepares a bank deposit slip for depositing the cash and cheques on the same day or puts them in an envelope inside a locked drawer to be deposited with the next day's collections. After making each bank deposit the cashier sends the remittance advice, cash analysis form and bank-validated deposit slip to the bookkeeper. Using the information in these documents the bookkeeper records the receipts in the cash receipts journal and posts credit entries to the individual customer accounts in the subsidiary ledger. At the end of each month the bookkeeper prepares monthly statements for mailing to the customers and also posts to the general ledger control accounts. Required: (9) Suggest procedures that may strengthen the internal control over cash collections and remittances. description above
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