Explain the weakness in internal control

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Reference no: EM13531043

The following control procedures are used in Danner Company for over-thecounter cash receipts.

1. Cashiers are experienced; thus, they are not bonded.

2. All over-the-counter receipts are registered by three clerks who share a cash register with a single cash drawer.

3. To minimize the risk of robbery, cash in excess of $100 is stored in an unlocked attaché case in the stock room until it is deposited in the bank.

4. At the end of each day the total receipts are counted by the cashier on duty and reconciled to the cash register total.

5. The company accountant makes the bank deposit and then records the day"s receipts.

Instructions

(a) For each procedure, explain the weakness in internal control and identify the control principle that is violated.

(b) For each weakness, suggest a change in the procedure that will result in good internal control.

Reference no: EM13531043

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