A unique identifier for each itm
Control totals to assure the completeness of processing
Edit test to identify unusual or incorrect items.
Authorization of transactions (three)
Authorization privileges should be assigned to individuals based on unique activities associatedwith individual and position.
Should assure that only authorized personnel can execute transactions.
Monitoring should be established.
are important in establishing the completeness of the population.(turnaround documents can also be used)
Periodic internal audits and competent, well trained employees.Controls for petty cash
Limiting access to petty cash funds by use of locked boxes
Requiring receipts for all petty cash disbursement with date and amount.
Reconciling the petty cash fund before replenishing it
Keeping customer receipts separate from petty cash funds.
Controls for cash management techniques
Lockboxes- sufficient controls must be established to make sure that all customer remittances receivedby the bank are posted.EFT- adequate controls built in the processCash management agreements with financial institutions- control regarding cash investmentsSome effort should be made to rotate control testing over time so that different controls are tested on arotating and somewhat unpredictable basis.Common types of misstatements regarding cash often include the following:
Transactions recorded in the wrong period
Embezzlements covered up by omitting outstanding checks and underfooting the outstandingchecks on the reconciliation
Double counting by manipulating accounts.An independent test of the bank reconciliation is quate effective in detecting major errors, such as thosethat might be covered up by omitting or underfooting outstanding checks.