Prepare the flow of cash receipt procedure.

Question

The following describes the cash receipts process for a company: The mail room staff consists of 35 clerks who receive and sort the general mail. Included in the mail are envelopes containing customer checks and remittance advices, which the clerks open to verify that the checks are signed and are constant in amount with the remittance advice. The checks and remittance advices are organized into batches and sent to the AR department where the AR clerk reviews them for correctness, posts to the AR sub ledger. The clerk then prepares two copies of a remittance list. One of these is filed in the department along with the remittance advice and the other is sent to the cash receipts department with the checks. Upon receipt of the checks and remittance list, the cash receipts clerk reconciles the documents and post the checks to the cash receipts journal. At the end of the day, the clerk prepares a deposit slip and sends it along with the checks to the bank. Finally, the clerk summarizes the…

Answer 1

Question

Chapter 4, Problem 4P

a.

To determine

Prepare the flow of cash receipt procedure.

b.

To determine

Determine the risks associated with current system configuration.

c.

To determine

Describe the measures taken by department to reduce risk associated with current system configuration.

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