Prepare a memo to the bank president, outlining the procedure that should be followed to prevent this type of problem in the future.

Question

Want to see the full answer?

Answer 1

Question

Chapter 4, Problem 4ATC

To determine

Prepare a memo to the bank president, outlining the procedure that should be followed to prevent this type of problem in the future.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Week 7Richard Palm is the accounting clerk of Olive Limited. He uses the source documents such as purchase orders, sales invoices and suppliers’ invoices to prepare journal vouchers for general ledger entries. Each day he posts the journal vouchers to the general ledger and the related subsidiary ledgers. At the end of each month, he reconciles the subsidiary accounts to their control accounts in the general ledger to ensure they balance.Discuss the internal control weaknesses and risks associated with the above process.

Exercise 7-03 Listed below are five procedures followed by Eikenberry Company.Indicate whether each procedure is an example of good internal control or of weak internal control. If it is an example of good internal control, indicate which internal control principle is being followed. If it is an example of weak internal control, indicate which internal control principle is violated. Use the table below. Procedure IC Good or Weak? Related Internal Control Principle 1. Several individuals operate the cash register using the same register drawer. Select a weakness in internal control WeakGood Select a control principle that is violated Documentation ProceduresHuman Resource ControlsEstablishment of ResponsibilityIndependent Internal VerificationPhysical ControlsSegregation of Duties 2. A monthly bank reconciliation is prepared by someone who has no other cash responsibilities. Select a weakness in internal control GoodWeak Select a control…

Question 9 To what does the following relate: As the business has grown and the number of transactions per day has multiplied, the financial accountant is very busy and constantly making errors 1. Control activities – Independent checks and reconciliations 2. Inherent limitations – cost vs benefit 3. Inherent limitations – human error, time constraints 4. Monitoring of controls Question 10 To what does the following relate: Entry to and exit from the warehouse are monitored 24 hours a day by surveillance cameras 1. Control environment 2. Monitoring of controls 3. Validity of transactions 4. Control activities – Access controls Question 11 To what does the following relate: Regular stock counts are performed, and the actual count compared to the inventory on the system 1. Control activities – documentation and records 2. Validity of transactions 3. Control activities – independent…