The ABC company maintains six bank accounts. Four of the accounts are with US Bank. They consist of a general fund (used for deposits, wire transfers and funding the zero based accounts transactions) and three zero based (funded only to cover checks presented for payment) accounts (Accounts payable, small warehouse disbursements and payroll). The remaining two accounts are with Piper Jaffrey (Short-term investments and Money market).

The general ledger general fund cash balance is reconciled to the bank statements monthly. The senior accountant reconciles outstanding checks for the zero based accounts as part of the general account reconciliations.

The senior accountant and accounting manager review the cash, money market, and short-term investments during the close process and make reclassification entries to properly reflect cash and cash equivalents, and investments in accordance with GAAP. The assistant controller reviews the cash reconciliation monthly.

The accounting manager performs several duties that do not provide for a proper segregation of duties with regards to cash and investments. The review of the cash reconciliation by the assistant controller, who does not have access to cash or investments is the key mitigating control relied upon by management.

Objective: To ensure proper controls exist over cash accounts, bank accounts are reconciled and reviewed by staff independ of the cash receipt and disbursement function.

Process:

1. The senior accountant accesses the US Bank website using a unique ID and password to download the Account Reconciliation Plan payroll account. This report is the month-end payroll account statement and lists all cleared account transactions. The bank mails hard copies of the statement to the senior accountant as backup monthly.
2. The senior accountant obtains copies of the following reports from accounting staff for use in performing the monthly cash reconciliation:
   1. Cash management spreadsheet prepared by the accounting manager which consists of checking account, sweep account, money market and US Bank cash account activity. The types of data included in the worksheet are account transfers, checks, wire transfers and ACH transactions.
   2. General Fund US Bank spreadsheet summary prepared by the accounting Cash management spreadsheet manager. This spreadsheet is a summary of general ledger detail by subsidiary location.
   3. Payment register and voided check reports provided by the senior accounts payable clerk. This report provides information of all checks written on the US Bank account for vendor payments and the voided check report lists all checks that were voided during the accounts payable process. When received, the senior accountant faxes the voided check report to US Bank to void the checks listed.
   4. ADP payroll Check reconciliation listing provided by the payroll accountant. This is a weekly ADP payroll report
3. The senior accountant also creates a weekly payroll reconciliation spreadsheet that reconciles the ADP report to the US Bank account reconciliation plan statement on a monthly basis.
4. All reports identified above are used to create a monthly bank reconciliation spreadsheet by transaction type. This spreadsheet is used to reconcile the cash balances in the reconciliation reports to the bank statement balances.
5. As a part of the cash reconciliation process, outstanding transactions are researched and resolved by the senior accountant in a timely manner. Journal voucher cash adjustments are created if needed.
6. The monthly bank reconciliation spreadsheet and journal vouchers are reviewed for accuracy and are approved by the assistant controller of finance. A copy of the spreadsheet is maintained in the senior accountants office. The assistant controller of finance ensures that outstanding reconciling items are resolved in a timely manner.
7. The accounting manager reconciles the money market and short-term investments accounts.
8. Journal vouchers are given to the accounting manager for entry into the general ledger.
9. The accounting manager verifies that the correct cutoff date is used for all cash receipts and disbursements transactions. Accounts payable closes the last working day of the month. Accounts receivable closes the first working day of the month or once the cash is posted for the last working day of the month.
10. The senior accountant reviews and researches any stale-dated checks quarterly to determine the reason for the items not clearing. Issues are resolved which could include the appropriate functional department, contacting the vendor or the employee, voiding the check(s), issuing stop payments, issuing replacement checks and requesting bank corrections.
11. At year-end the senior accountant performs an analysis of outstanding checks. For checks greater than $100, a written notice will be sent to the payee along with research to determine the owner. Any check outstanding greater than one year will be reclassified to a liability account. The liability accounts will be reviewed and all checks outstanding greater than three years will be remitted to the state by 10/31. The ABC company maintains record for five years in accordance with state regulations.

Prepare a flowchart with the following scenario.