Question

In: Accounting

Consider each situation separately. Identify the missing internal control procedure from these characteristics:

Question Identifying internal controls. Consider each situation separately. Identify the missing internal control procedure from these characteristics:

• Assignment of responsibilities

• Separation of duties

• Audits

• Electronic devices

• Other controls (specify)

a. While reviewing the records of Quality Pharmacy, you find that the same Team member orders merchandise and approves invoices for payment.

b. Business is slow at Amazing Amusement Park on Tuesday, Wednesday, and Thursday nights. To reduce expenses, the business decides not to use a ticket taker on those nights. The ticket seller (cashier) is told to keep the tickets as a record of the number sold.

c. The same trusted team member has served as a cashier for 12 years.

d. When business is brisk, Fast Mart deposits cash in the bank several times during the day. The manager at one store wants to reduce the time employees spend delivering cash to the bank, so he starts a new policy. Cash will build up over weekends, and the total will be deposited on Monday.

e. Grocery stores such as Convenience Market and Natural Foods purchase most merchandise from a few suppliers. At another grocery store, the manager decides to reduce paperwork. He eliminates the requirement that the receiving department prepare a receiving report listing the goods actually received from

the supplier.

 

Solutions

Expert Solution

Step 1: Definition of internal control

 

Internal control is the control that controls the internal activity of the company.

 

Step 2: Missing internal control procedure

 

In this situation, the missing internal control is the separation of the duties because the same team member orders merchandise and approves invoices for payment.

In this situation, the missing internal control is the separation of duties because the company decides not to use a taker; instead, they give this duty to the ticket seller.

This type of situation comes under other control because, in this, the company does not rotate the job.

This situation comes under the other control because of not depositing cash soon enough for adequate security.

This statement clearly shows the deficiency of assignment of responsibilities.

 


Answer

The has a lack of separation of duties

The has a lack of separation of duties

 The company is missing the job rotation

The company is missing the other internal control

 The company is the missing assignment of responsibilities 

 

Related Solutions

Requirements 1.?? Identify the missing internal control characteristics in each situation. Jade Applications has decided that...
Requirements 1.?? Identify the missing internal control characteristics in each situation. Jade Applications has decided that one way to cut costs in the upcoming year is to fire the external auditor. The business believes that the internal auditor should be able to efficiently monitor the? company's internal controls. b. In an effort to minimize the amount of? paperwork, Ross Homes has decided that it will not keep copies of customer invoices related to sales revenue. Ross believes that this effort...
1. Identify the risks and 2. Internal control procedure(s) to mitigate the risk Characteristics of the...
1. Identify the risks and 2. Internal control procedure(s) to mitigate the risk Characteristics of the Organization - A small non-profit organization that provides housing for youths with revenues of approximately $700,000. The organization also provides counseling and offers other services to assist the youths. - There are 2 funding agreements with the Municipality – 1) for purposes of the housing operations and 2) for community development. The funding agreements are signed annually. Any excess funding at the end of...
If the activity presents an internal control risk, identify the control that is missing and explain...
If the activity presents an internal control risk, identify the control that is missing and explain why. If the activity does not present an internal control risk, identify the control that is being properly used and explain why. (Physical controls, Assignment of responsibilities, Separation of duties, Independent verification,Documentation) 1.The company's buyers are responsible for ordering furniture, receiving orders in the warehouse and paying suppliers. 2.When employees at the store check-in at the store's POS system, they need to enter the...
Please list each of the three conditions of fraud and identify one internal control procedure that...
Please list each of the three conditions of fraud and identify one internal control procedure that management can implement to reduce the risk of fraud occurrence. Be specific in the type of control that you describe. For instance, state the business cycle (e.g., treasury, inventory, receivables, etc.) and the way in which the control acts to mitigate fraud risk.
Each situation below describes an internal control weakness in the cash payments process. Identify which of...
Each situation below describes an internal control weakness in the cash payments process. Identify which of the five internal control principles is violated, explain the weakness, and then suggest a change that would improve internal control. 1. The warehouse clerk is responsible for ordering inventory when levels become low and advising the accounting department to issue a payment to the supplier when ordered goods are received. 2. For each purchase, the accountant compares the purchase order (prepared by the purchasing...
Required: Describe the purpose of each internal control procedure. a. Prenumbering and periodically accounting for all...
Required: Describe the purpose of each internal control procedure. a. Prenumbering and periodically accounting for all purchase orders. b. Receiving department employees do not have access to the quantities ordered on purchase orders c. Requiring two signatures on checks for large amounts d. Maintaining an approved supplier list and checking that all purchase orders are issued only to suppliers on that list e. Cancellation of the voucher package by the cashier after signing the check f. Requiring that a copy...
What is the most important Internal Control Procedure to you?
What is the most important Internal Control Procedure to you?
Define fraud and internal control in detail. Identify the principles of internal control and define them....
Define fraud and internal control in detail. Identify the principles of internal control and define them. Give suitable examples      
Identify an internal control structure and describe an effective internal control structure, relating to accounting and...
Identify an internal control structure and describe an effective internal control structure, relating to accounting and preparing accurate financial statements.
For each of these five separate cases, identify the principle(s) of internal control that is violated....
For each of these five separate cases, identify the principle(s) of internal control that is violated. Recommend what the business should do to ensure adherence to principles of internal control. Jen Novinska records all incoming customer cash receipts for her employer and posts the customer payments to their respective accounts. At Tico Company, Julia and Trevor alternate lunch hours. Julia is the petty cash custodian, but if someone needs petty cash when she is at lunch, Trevor fills in as...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT