Accounting Homework need by TOMORROW 1PM EASTERN
NEED TOMORROW 1PM EASTERN
As a new employee at Canyon rental, an outdoor outfitters and supply shop, your boss has asked you to look at the internal control system within the store. He is seeking a loan for expansion and must have his books audited. The auditor asked about his control procedures and documentation. He has no idea what the auditor is talking about. Your boss has asked you to do what you need to understand the system and has asked for a memo with your observations and recommendations by the end of the week. Through interviews and observation you notice the following:
- Purchase orders, and sales invoices are not pre-numbered due to the higher cost of printing the forms.
- To save time the sales clerk enters the sales at the end of the day into the accounting records, prepares the deposit and delivers it to the bank.
- The sales clerk a trusted and long-term employee grants sales returns at her discretion.
- The purchasing manager both orders merchandise and approves the payment for the order.
- Betty Gamble, the bookkeeper has not taken a vacation in three years.
- Checks are brought to the owner twice a week for signing. He is overwhelmed by all of the paperwork and has asked for the checks only on which he stamps his signature.
In your memo, give a summary of the elements of an effective internal control system. Comment on each of your observations and if there is a weakness provide a solution. Your memo should be 2-3 pages.