You are the lead auditor performing a walkthrough of the bank reconciliation performed by the company controller. What is the design deficiency of the control below ? What additional steps should the Controller perform ? The Controller says, "I first review the sorted list of returned checks and find which numbers are missing. Second I determine the amount uncleared checks by referring to the cash disbursements journal. If the bank accounts reconcile at that point, the review is done. If it does not reconcile I search for in transit deposits, checks from the beginning outstanding checks list that still have not cleared, other reconciling items and bank errors until it reconciles."

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