The following list presents various internal control strengths (S) or risks (R) that may be found in a company revenues and cash collection processes.
Credit is authorized by the credit manager.
Checks paid in excess of $5,000 require the signatures of two authorized members of management.
A cash receipts journal is prepared by the Treasurer department.
Collections received by check are received by the company receptionist, who has no additional recordkeeping responsibilities.
Collections received by check are immediately forwarded unopened to the accounting department.
A bank reconciliation is prepared on a monthly basis by the Treasurer department.
Security cameras are placed in the shipping dock.
Receiving reports are prepared on pre-printed, numbered forms.
The billing department verifies the amount of customer sales invoices by referring to the authorized price list.
Entries in the shipping log are reconciled with the sales journal on a monthly basis.
Payments to vendors are made promptly upon receipt of goods or services.
Cash collections are deposited in the bank account on a weekly basis.
Customer returns must be approved by a designated manager before a credit memo is prepared.
Account statements are sent to customers on a monthly basis.
Purchase returns are presented to the sales department for preparation of a receiving report