The following are deficiencies in internal controls over cash. For each deficiency indicate what substantive audit procedure(s) should be performed to determine whether any material misstatements exist. Consider each deficiency independently of the others. While each deficiency poses potential problems, identify two that would heighten your professional skepticism the most and explain your rationale,The person who opens the mail prepares the deposit when the cashier is not available.If a customer does not submit a remittance advice with a payment, the mail clerk sometimes does not prepare one for the accounts receivable department.Occasionally, the treasurer's department does not cancel the sup- porting documents for cash disbursements.Customer correspondence concerning monthly statements is han- dled by the person who makes the bank deposits.Bank reconciliations are not prepared on a timely basis. When prepared, they are prepared by the person who handles incoming mail.

“Since you have posted a question with multiple sub parts, we will solve first 3 sub parts for you.…

Answered: The following are deficiencies in…

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter10: Auditing Cash, Marketable Securities, And Complex Financial Instruments

Section: Chapter Questions

Problem 25RQSC

See similar textbooks

Related questions

Question

The following are deficiencies in internal controls over cash. For each deficiency indicate what substantive audit procedure(s) should be performed to determine whether any material misstatements exist. Consider each deficiency independently of the others. While each deficiency poses potential problems, identify two that would heighten your professional skepticism the most and explain your rationale,

The person who opens the mail prepares the deposit when the cashier is not available.
If a customer does not submit a remittance advice with a payment, the mail clerk sometimes does not prepare one for the accounts receivable department.
Occasionally, the treasurer's department does not cancel the sup- porting documents for cash disbursements.
Customer correspondence concerning monthly statements is han- dled by the person who makes the bank deposits.
Bank reconciliations are not prepared on a timely basis. When prepared, they are prepared by the person who handles incoming mail.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions