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Wong has the following internal controls over cash receipts and cash payments. Identify the control activity that is applicable to each item in the table
Wong has the following internal controls over cash receipts and cash payments.
Identify the control activity that is applicable to each item in the table shown below:
| Activity | ||||
| 1 | All cash is deposited intact, in the bank account, daily. | Segregation of DutiesIndependent Checks of PerformanceDocumentation ProceduresPhysical and IT ControlsEstablishment of ResponsibilityHuman Resource Controls | ||
| 2 | Blank cheques are stored in a safe in the controllers office. | Segregation of DutiesHuman Resource ControlsIndependent Checks of PerformanceEstablishment of ResponsibilityDocumentation ProceduresPhysical and IT Controls | ||
| 3 | All cashiers are bonded. | Human Resource ControlsEstablishment of ResponsibilityPhysical and IT ControlsIndependent Checks of PerformanceDocumentation ProceduresSegregation of Duties | ||
| 4 | All over-the-counter receipts are recorded on cash registers. | Documentation ProceduresPhysical and IT ControlsIndependent Checks of PerformanceSegregation of DutiesEstablishment of ResponsibilityHuman Resource Controls | ||
| 5 | All payments, except for petty cash transactions, are made by cheque. | Physical and IT ControlsEstablishment of ResponsibilityDocumentation ProceduresHuman Resource ControlsIndependent Checks of PerformanceSegregation of Duties | ||
| 6 | Cheque signers are not allowed to record cash payment transactions. | Human Resource ControlsIndependent Checks of PerformanceEstablishment of ResponsibilitySegregation of DutiesPhysical and IT ControlsDocumentation Procedures | ||
| 7 | Company cheques are pre-numbered. | Human Resource ControlsDocumentation ProceduresEstablishment of ResponsibilityPhysical and IT ControlsIndependent Checks of PerformanceSegregation of Duties | ||
| 8 | Daily cash counts are made by cashier department supervisors. | Documentation ProceduresEstablishment of ResponsibilitySegregation of DutiesPhysical and IT ControlsHuman Resource ControlsIndependent Checks of Performance | ||
| 9 | Only cashiers may operate cash registers. | Establishment of ResponsibilityPhysical and IT ControlsIndependent Checks of PerformanceHuman Resource ControlsSegregation of DutiesDocumentation Procedures | ||
| 10 | Only the controller or assistant controller may sign cheques. | Establishment of ResponsibilityDocumentation ProceduresHuman Resource ControlsSegregation of DutiesPhysical and IT ControlsIndependent Checks of Performance | ||
| 11 | The bank statement is reconciled monthly by an internal auditor. | Independent Checks of PerformancePhysical and IT ControlsEstablishment of ResponsibilitySegregation of DutiesDocumentation ProceduresHuman Resource Controls | ||
| 12 | The duties of receiving cash, recording cash, and maintaining custody of cash are assigned to different individuals. | Independent Checks of PerformanceSegregation of DutiesDocumentation ProceduresPhysical and IT ControlsEstablishment of ResponsibilityHuman Resource Controls |
Indicate if the control activity is for cash receipts or for cash payments including petty cash.
| Cash Receipts or Cash Payments | ||||
| 1 | All cash is deposited intact, in the bank account, daily. | Cash ReceiptsBothCash Payments | ||
| 2 | Blank cheques are stored in a safe in the controllers office. | Cash ReceiptsCash PaymentsBoth | ||
| 3 | All cashiers are bonded. | Cash PaymentsCash ReceiptsBoth | ||
| 4 | All over-the-counter receipts are recorded on cash registers. | Cash PaymentsCash ReceiptsBoth | ||
| 5 | All payments, except for petty cash transactions, are made by cheque. | Cash PaymentsCash ReceiptsBoth | ||
| 6 | Cheque signers are not allowed to record cash payment transactions. | BothCash PaymentsCash Receipts | ||
| 7 | Company cheques are pre-numbered. | BothCash ReceiptsCash Payments | ||
| 8 | Daily cash counts are made by cashier department supervisors. | BothCash PaymentsCash Receipts | ||
| 9 | Only cashiers may operate cash registers. | Cash ReceiptsCash PaymentsBoth | ||
| 10 | Only the controller or assistant controller may sign cheques. | Cash ReceiptsBothCash Payments | ||
| 11 | The bank statement is reconciled monthly by an internal auditor. | Cash PaymentsCash ReceiptsBoth | ||
| 12 | The duties of receiving cash, recording cash, and maintaining custody of cash are assigned to different individuals. | Cash ReceiptsCash PaymentsBoth |
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Fundamentals of Financial Accounting
Authors: Fred Phillips, Robert Libby, Patricia Libby
5th edition
78025915, 978-1259115400, 1259115402, 978-0078025914
