Key Control Activities to Cash Receipts and Payments

The video outlines internal control measures designed to safeguard cash, which is noted as being highly susceptible to theft.
Here is an overview of the key concepts covered:
• Definition of Cash: The document defines cash to include coins, currency, cheques, money orders, and money on hand or in the bank. A general rule provided is that if a bank accepts it for deposit, it is considered cash.
• Control Activities for Cash Receipts: The source details five categories of control for cash receipts, noting they are most effective when receipts are deposited daily or made via Electronic Funds Transfer (EFT):
◦ Assignment of Responsibility: Only designated personnel should handle cash receipts.
◦ Segregation of Duties: Different individuals should record cash receipts and handle the actual cash.
◦ Documentation: Use remittance advices, cash register tapes, and deposit slips.
◦ Physical Controls: Store cash in safes with limited access and use cash registers.
◦ Review and Reconciliation: Supervisors should count receipts daily, and accountants should compare totals with bank deposits.
• Control Activities for Cash Payments: Similar controls are applied to payments, with a preference for making payments by cheque or EFT rather than cash.
◦ Physical Controls: Specifically mentions requiring multifactor authentication to log into EFT payment systems.
◦ Documentation: Ensure every payment is supported by an approved invoice.

Видео Key Control Activities to Cash Receipts and Payments канала Sameer Alrishani