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These procedures are used in $$The Boutique$$ for cash disbursements $($payments$).$

$1.$ Checks are stored in an unmarked envelope on a shelf behind the cash register.

$2.$ The store manager approves all payments before she writes, signs and sends checks.

$3.$ The store buys $$used$$ items for resale. All employees may buy $$resale$$ items by

paying cash from the register. The employee documents a purchase on a piece of

paper, writing the cost and description of the item $$ then signing the paper $-$ and

putting it in the register.

$4.$ After paying the invoices $($bills$)$ the bookkeeper places them in the supplier$$s folder.

$5.$ The bookkeeper prepares the bank deposits and cash records and reports any

discrepancies directly to the owner.

Instructions

For each weakness, suggest a SPECIFIC change in procedure that will result in better internal control. $($If you need more space $$ add it by hitting the space bar INSIDE the tables row or column.$)$

Weakness Specific Recommended Change

$1.$ Checks are not stored in a secure area.

$2.$ The approval and payment of bills is done by the same individual.

$3$a$.$ Unauthorized employees making purchases.

$3$b$.$ Use of cash instead of checks; no prenumbered invoices.

$4.$ Filing does not prevent a

bill from being paid more than once.

$5.$ The bank reconciliation is not inde$-$pendently prepared.

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