Internal Control Checklist/Questionaires/Assessment On Bank And Cash

July 2nd, 2009 Comments off
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Do you want to set up an audit checklist to ensure that there are proper internal controls for your  company’s Bank and Cash?
Append below are some suggested salient internal controls points for Bank and Cash:
General

  • Polices and procedures for cash handling and banking controls should be clearly documented and communicated.
  • The amount of cash kept at the office premise should be within insurance coverage amount.

Banking Facilities

  • Bank mandates that empower company employees to perform banking transactions should be updated and authorised by the Board of Directors immediately upon changes of personnel.
  • Pre signed cheques should not be allowed.
  • All blank unused cheques received from bank should be crossed immediately.
  • All blank cheques should be kept in a safe or secured under lock at all times.
  • An unused cheque book register should be maintained and updated on a timely basis.

Receipts and Disbursements

  • Cheques received should be reconciled to bank in slips daily by an independent officer.
  • An independent officer should agree cash received to receipts daily.
  • Disbursements should be approved in accordance within the authority limits.
  • All paid invoices and supporting documents should be invalidated immediately after payment with a “PAID” chop.

Petty cash

  • Petty cash should be maintained on an impress system. Operating units may decide the float based on their individual requirements. Nonetheless they must ensure that the float is not excessive.
  • Surprise counts should be performed half yearly by the Finance Manager/Accountant.
  • The date and time of the surprise count should be indicated on the surprise count sheet and initialled by the respective parties involved.
  • For cash to be kept overnight it should be in a locked safe.

Reconciliation

  • Bank statements should be reconciled to the general ledger monthly within fifteen working days and reviewed by the Finance Manager/Accountant.
  • Unpresented cheques appearing in the bank reconciliations should include the names of recipients and dates of cheques.  Such cheques should be investigated if not cleared within one month after despatch.

Segregation of Duties

  • There should be segregation of duties between the following functions:

Cash and cheque custodian
Cheque signing authority
Cash receipts
Accounting and recording receipts and disbursement
Bank reconciliation
Delegation of Authority (DOA)

  • The documented DOA should cover the authority to:

Selection of banks and financial institutions
Opening and closing bank accounts/facilities
Application and operation of banking facilities
–          Signing of cheques and other payment instructions

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Financial Accounting

 
 

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