Internal control

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Sumitha K (Querist)
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25 June 2011 Hi Exeperts,

In below case can you suggest best internal control:

Cheques received in the company are entered in cheque register and the same goes to bank for deposit. suppose the person fails to make an entry into register either intentionally or unintentionally how to detect and what controls can be put in place to check that.

CA Chandresh Agrawal

CA Chandresh Agrawal (Expert)
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25 June 2011 As most of the cheques are account payee only i dnt think there is less chance of fraud but still u cn put some internal conrol like

Periodical reconcilation with party
if possible make entry in gate register and then in accounts dept so u cn reconcile both register or authorise only account dept. personnel to sign acknowledgment of receipt of cheque.. so in tht case u cn reconcile both register

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Sumitha K

Sumitha K (Querist)
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26 June 2011 Thanks Mr.Agarwal.
Yes it is not possible to commit fraud with a/c payee cheque. but still if the cheque is of high value and if not deposited its the company which will lose.
Even though we have 2 points of register, if the first authorised person does not make entry and pass it on then it will not be highlighted until reconciled. Plus if there are 1000's of customers it reconciliation will be slower process.

My doubt is are there any mechanism through which we can ensure that all cheques are accounted immediately.

Thanks.
sumitha

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