Whether you or your clients receive payments from customers via cash or check there are several good controls to keep in mind to ensure all of your money makes it to the bank! Too often we hear “We only go to the bank once a week because we only collect payments in the form of checks.” Or another favorite, “Our employees are so trustworthy, we don’t create receipts every time cash or checks are received.” Yikes!
- All cash or checks received should be receipted via numerically sequential receipts (even if a customer declines receipt)
- Endorse checks with bank stamp the moment received
- All cash and checks should be maintained in locked drawer or safe at all times throughout the day
- All funds should be deposited daily (even if “only” checks)
- For a non profit or other organization that receives unexpected funds, ensure there is dual custody over the opening of mail or during fundraising events
- Consider installing surveillance cameras at the front desk and/or other areas where cash is received or processed
- Segregate duties around cash receipt functions. Make sure the person opening the mail/receiving customer payments is NOT the same person who has the ability to record credits on customer accounts or take funds to the bank
- For a non profit or church organization, make sure cash counting volunteers are rotated and that members of count teams are not related
In addition to ongoing controls appropriate to your organization, there are several ways to ensure proper oversight over cash receipts.
- At the end of the day, week or month, ensure the entirety of sequential receipts are accounted for and that all funds received per the receipts can be traced to bank deposits
- Review bank statements to ensure deposits per the bank match deposit amounts (and dates) per the accounting records
- Review customer records to ensure no unauthorized credits or write offs were recorded (which would indicate money was received but diverted)
- Perform analytical review to determine whether cash receipts are “in line” with past performance
- Cash business? Take a look at your bank deposit slip book and ensure that you see amounts for currency and coin at the top of each deposit slip
Do you see discrepancies in your processes and procedures or need help with internal controls? Call Acuity Forensics! (360) 573-5158