As Payments Are Received, One Mailroom Employee Is Assigned the Responsibility

question 22

Multiple Choice

As payments are received, one mailroom employee is assigned the responsibility of prelisting receipts and preparing the deposit slip prior to forwarding the receipts, deposit slip, and remittance advices to accounts receivable for posting. Accounts receivable personnel re-foot the deposit slip, stamp a restrictive endorsement on the back of each check, and then forward the receipts and deposit slip to the treasury department. Evaluate the internal control of the described process. Which of the following is a reasonable assessment of internal control in this process?

• A)Adequate internal control.
• B)Inadequate internal control because mailroom employees should not have access to cash.
• C)Inadequate internal control because treasury employees should prepare the deposit slip.
• D)Inadequate internal control because of a lack of separation of duties.

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Definitions:

Management

A process designed to achieve an organization's objectives by using its resources effectively and efficiently in a changing environment.