ACC 100 Lecture Notes - Lecture 7: Bank Reconciliation, Bank Statement, Overdraft
Document Summary
Establishment of responsibility: specific employees responsible for specific task. Segregation of duties: the work of one employee should be a reliable basis for monitoring the work of another employee (duties should be divided up so that one person cannot both commit a fraud and cover it up) Documentation procedures: give evidence that transactions and events have happened (i. e receipt) Physical control: mechanical and electronic controls to safeguard (protect) assets and improve the accuracy and reliability of the accounting records (i. e use locks, safes, etc) (double-check) Performance reviews: include independent internal/external reviews of performance and records having someone else review the work effectiveness of the company"s system of internal control. External auditors: professionals are hired by the company to see whether financial statements are fairly presented. Other controls: trustworthy employees handle the cash or rotating employees duties and give them vacations. Fidelity insurance: against the theft of assets by dishonest employees.
