Case 14-1a

In: Business and Management

Submitted By monkey32
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Case 4 - Exercise 4-2 (a) INTERNAL CONTROL - PRELIMINARY ANALYSIS CLIENT: Lakeside SYSTEM: DATE: 10/11/12 PREPARED BY:

List each document found in this system, the number of copies, and whether it is prepared internally or externally. Bank Reconciliation: prepared internally and one copy per month Invoice Slips: prepared internally with one copy per payment Validated Bank Deposit Slips: prepared internally and there are two copies per day Sales Invoice: prepared internally Cash Remittance List: prepared internally with four copies per day Bank Statement: prepared externally with one copy a month Answer each of the following questions. For each "No" answer, comment on whether an internal control weakness is indicated. QUESTION | YES | NO | COMMENT | (1) Is each document within this system pre-numbered? | | X | None of the documents other than the sales invoices and bills of lading are renumbered | (2) Is the authority for completing each document clearly delineated? | X | | | (3) Are all documents subsequently reviewed by an independent party within the company? | | X | The bank reconciliation form was not reviewed by the Assistant to the President | (4) Are appropriate procedures clearly spelled out for completing and reviewing each document? | | X | There are no instructions when discrepancies are found in the statements. | (5) Is the record-keeping function…...

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