财务会计英文第五版版第八章

1、Financial Accounting BY 周卉 Vivian TelQQ: 44003160 Email: Chapter 8 INTERNAL CONTROL AND CASHCHAPTER 8INTERNAL CONTROL AND CASHSTUDY OBJECTIVESAfter studying this chapter, you should understand:1.Definition, Pinciples and limitations of internal control5.Use of of a bank in internal cont

2、rol over cash2.Internal control for cash receipts6.Bank reconciliations-bank statement with accounting recod3.Internal control for cash disbursements7.Cash reporting4.Petty cash fundsThe plan of organization and all related methods and measures adopted by a business in order to:STUDY OBJECTIVE 1DEFI

3、NITION OF INTERNAL CONTROLSafeguard assetsEnhance accuracyand reliability ofaccounting recordsSTUDY OBJECTIVE 2PRINCIPLES OF INTERNAL CONTROL6.Other Controls3.Documentation procedures5.Independent internal verification2.Segregation of duties4.Physical, mechanical, & electronic controls1.Establishmen

4、t of responsibilityIllustration 8-1Control is most effective when only one person is responsible for a given task.1. ESTABLISHMENT OF RESPONSIBILITY明确责任明确责任eg. Only one cashier should operatea cash register during a shift.eg. Only one designated person is assigned to authorize checks to make payment

5、 Application of this principle:1)Related activities should be assigned to different employees -eg. Related purchasing activities2)Record-keeping separate from physical custody -eg. Inventory count -eg. The cashier should not update the accounting records.u the work of one employee should provide a r

6、eliable basis for evaluating the work of another employee.2. SEGREGATION OF DUTIES职责划分职责划分Documents are forwarded to accounting department promptly Documents are pre-numberedSequence is accounted for3. DOCUMENTATION PROCEDURES凭证编制程序凭证编制程序Checks have sequential numbers. Missing check numbers are inve

7、stigated.u Safes, vaults, and safety deposit boxes for cash and business papers u Locked warehouses and storage cabinets for inventories and recordsu Computer facilities with pass key access 4. PHYSICAL CONTROLS物理手段控制物理手段控制Designed to safeguard assets and accounting recordsAlso designed to restrict

8、access 4. MECHANICAL AND ELECTRONIC CONTROLS机器手段控制机器手段控制u Alarms to prevent break-insu Television monitors and garment sensors to deter theftu Time clocks for recording time workedReview, comparison, & reconciliation of data prepared by another employeeRequirement:1.Periodically or On a surprise bas

9、is2.By an independent person3. Discrepancies and exceptions should be noted and reported5. INDEPENDENT INTERNAL VERIFICATION独立的内部核查独立的内部核查Example: head cashier compares daily sales summarieswith cash register tapes.In large companies often assigned to internal in the internal auditing departmentInde

10、pendent Internal VerificationAccounting Employee AAssistant Cashier BAssistant Treasurer C资金管理专员资金管理专员Segregation of DutiesSEGREGATION OF DUTES VS. INDEPENDENT INTERNAL VERIFICATIONMaintains cash balance per booksMaintains custody of cash on handMakes monthly comparisons. Reports differences to trea

11、surer.Bonding employees who handle cashRotation of duties轮换轮换Mandatory vacation6. OTHER CONTROLSMandatory vacations make itimpossible for a bookkeeperto permanently conceal “irregular” activities. LIMITATIONS OF INTERNAL CONTROLCost-Benefit ConsiderationsThe cost of implementing a control should be

12、less than the perceived benefit.Human ElementA system is only as goodas the people operating it.Collusion合谋Two people may conspire to override a controlSize of companiesu Internal control over cash is imperative(强强制性的制性的) in order to safeguard cash and assure the accuracy of the accounting records f

13、or cash.u Cash includes coins, currency, checks(支支票票), money orders(汇款单汇款单), and money on hand or on deposit at a bank or similar depository.CASH现金现金STUDY OBJECTIVE 3INTERNAL CONTROL FOR CASH RECEIPTS 1.Only designated personnel are authorized to handle or have access to cash receipts. 2.Different i

14、ndividuals should: -receive cash，have custody of cash -record cash receipt transactions STUDY OBJECTIVE 3INTERNAL CONTROL FOR CASH RECEIPTS现金收入的内控制度现金收入的内控制度 3.Register tapes, remittance advices汇款通知汇款通知 and deposit slips 4.Cash should be stored in safes and bank vaults and access to storage areas sh

15、ould be limited to authorized personnelINTERNAL CONTROL FOR CASH RECEIPTS5.Daily cash counts and daily comparisons of total receipts.6.Others: -All personnel who handle cash receipts are bonded and required to take vacations. -Cash registers are visible to customers.INTERNAL CONTROL FOR CASH RECEIPT

16、SInternal control forCash Receipts Over the Counter1.Cashier收银员收银员 enters the amount of the sale on the keypad and so onto the cash register tape现金小票现金小票. -The terminal should be positioned so that customers can see the amount the cashier enters into the cash register. -The cash drawer should open o

17、nly when the sales clerk enters an amount on the keypad. -The roll of tape locked inside the machine records each sale and cash transaction.2.The head cashier收银部门主管收银部门主管 counts the cash in the drawer, compares the cash in the drawer and the amount in the register tape to prepare the daily cash summ

18、ary每日现金汇总每日现金汇总3.At the end of the day, the head cashier deposits the cash in the bank and obtain the deposit slip存款单存款单.4.-One copy of the daily cash summary goes to accounting -another copy of daily cash summary and deposit slip go to the treasurer财务主管财务主管 for verification of cash receipt.Internal

19、 control forCash Receipts by Mail Cash receipts by mails are made when credit sales take place and are in the form of checks or money orders. All mail receipts should be opened by two mailroom employees. The mailroom employees forward the checks and remittance advice to the cashiers department to pr

20、epare the daily cash summary.Payments made by pre-numbered check not cash（except for petty cash transactions).Internal control rules for cash disbursement include:1.Limit & specify check-signing authority 2.Separate approval, payment and recording functions 3.Pre-numbered checks used to pay only app

21、roved invoices.4.Store blank checks in a safe, and limit access.5.Compare checks to invoice, bank reconciliation6.Other: Stamp invoices when paid.STUDY OBJECTIVE 4INTERNAL CONTROL FOR CASH DISBURSEMENTS现金支出的内控制度现金支出的内控制度Definition:A network of approvals by authorized individuals acting independently

22、 to ensure that disbursements by check are proper. Enhances control over cash disbursements.A voucher应付凭单应付凭单,报帐单报帐单is an authorization form prepared for each expenditure.Vouchers are recorded in a journal called the voucher register应付凭单登记薄应付凭单登记薄 .Internal control for cash payment fromVOUCHER SYSTE

23、M应付凭单应付凭单The use of pre-numbered checks in disbursing cash is an application of what internal control principle? REVIEW QUESTIONAnswer: Documentation proceduresA disbursement system that uses wire, phone, or computer to transfer cash.Regular payments such as those for house, car, and utilities are f

24、requently made by EFT.Internal control for cash payment fromEFT SYSTEM电子资金划账电子资金划账 Used to pay small amounts Operation of the fund, often called an imprest system (定额备用定额备用金制金制), involves:1 establishing the fund2 making payments from the fund3 replenishing the fund补足基金补足基金 Accounting entries are req

25、uired when:1 the fund is established2 the fund is replenished3 the amount of the fund is changedNo accounting entry is made to record a payment at the time it is made from petty cash.STUDY OBJECTIVE 5Internal control for cash payment fromPETTY CASH FUNDS零用零用基金基金 Two steps to establish a petty cash f

26、und1 appoint a petty cash custodian 2 determine the size of the fund (to cover 3-4 weeks)STEP1: ESTABLISHING THE FUND建立基金建立基金GENERAL JOURNALDateAccount Titles and ExplanationDebitCreditMar. 1Petty Cash Cash (To establish a petty cash fund)100100Laird Company decides to establish a $100 fund on March

27、 1. When the fund is established, a check payable to the petty cash custodian is issued for the stipulated amount.Internal control procedures:The size of expenditures and use are limitedPre-numbered petty cash receipt预先编序的零预先编序的零用金收据用金收据 are use each time a payment is made Attached with supporting d

28、ocuments such as invoice or freight billSTEP2:MAKING PAYMENT FROM THE FUND备用金支出备用金支出On March 15 the petty cash custodian requests a check for $87. The fund contains $13 cash left and petty cash receipts for postage $44, freight-out $38, and miscellaneous expenses杂项费用杂项费用, $5. Petty cash account is n

29、ot affected by the replenishing entry.GENERAL JOURNALDateAccount Titles and ExplanationDebitCreditMar. 15Postage ExpenseFreight-outMiscellaneous Expense Cash (To replenish petty cash fund)4438 587STEP3: REPLENISHING THE FUND补足基金补足基金 Custodian initiates request for reimbursement. Custodian prepares a

30、 schedule of payments with documentation stamped “paid”. Treasurer approves replenishment.On March 15 the petty cash custodian requests a check for $88. The fund contains $12 cash left and petty cash receipts for postage $44, freight-out $38, and miscellaneous expenses, $5. GENERAL JOURNAL Date Acco

31、unt Titles and Explanation Debit Credit Mar. 15 Postage Expense Freight-out Miscellaneous Expense Cash Over and Short Cash (To replenish petty cash fund) 4438 5 188REPLENISHING THE FUND Revised entry for cash over and short现金溢缺.-Debit balance of cash over and short is reported in the income statemen

32、t as a miscellaneous expense杂项费用杂项费用-Credit balance of cash over and short is reported in the income statement as a miscellaneous revenue杂项收入杂项收入Using a bank minimizes currency that must be kept on hand and contributes significantly to good internal control over cash.A company can safeguard its cash

33、 by using a bank as a depository and as a clearing house.STUDY OBJECTIVE 6CONTROL FEATURES-BANKSu The major documents used to control a bank account include:-1.Deposit ticket(for cash receipt by deposit)-2Signature card and check (for cash payment by check) -3.Bank statement(for reconciliation)uThe

34、customer fills in the dollar amount of each deposit in the deposit ticket(存单存单)as a proof uNew depositors are required to sign a signature card(签字签字样卡样卡) when opening a checking deposit account支票存款帐支票存款帐户户.USE OF A BANKSTUDY OBJECTIVE 6CONTROL FEATURES-BANKSA written order signed by the depositor di

35、recting the bank to pay a specified sum of money to a designated recipient.Three parties involved:1 Maker/drawer issues the check支票签发人支票签发人/付款人付款人2 Bank/payer on which check is drawn付款银行付款银行3 Payee to whom check is payable收款人收款人u The check has two parts, the check itself and the remittance advice 汇款

36、通知汇款通知/说明说明which is an optional attachment.WRITING CHECKS支票支票A bank statement shows:1 checks paid & other debits charged against the account2 deposits and other credits made to the account3 account balance after each days transactionsBANK STATEMENTS银行账单银行账单Debit memorandum借项通知借项通知indicate other char

37、ges that decrease depositors account. (eg. ATM service charges, cost of printing check, bounced NSF支票存款帐户余额不足支票存款帐户余额不足/空头支空头支Credit memorandum贷项通知贷项通知 indicate other amounts that increase the depositors account. (eg. collection of notes receivable应收票据应收票据and Interest income).BANK STATEMENTS 银行对账单银行

38、对账单A C C O U N TW. A . L A I R D C O MP A N YS t a t e m e n t D a t e / C r e d i tS T A T E ME N T7 7 WE S T C E N T R A L A V E N U EL i n e C l o s i n g D a t eMI D L A N D , MI C H I G A N 4 8 6 5 4A p r i l 3 0 , 1 9 9 64 5 7 9 2 3A C C O U N T N U MB E RB a l a n c eD e p o s i t s a n d C r

39、 e d i t sC h e c k s a n d D e b i t sB a l a n c eL a s t S t a t e me n tN o .T o t a l A m o u n tT o t a l A m o u n tT h i s S t a t e me n t1 3 , 2 5 6 . 9 02 03 4 , 8 0 5 . 1 02 63 2 , 1 5 4 . 5 51 5 , 9 0 7 . 4 5D E P OS I T S A N DC H E C K S A N D D E B I T SC R E D I T SD A I L Y B A L A

40、 N C ED a t eN o .A mo u n tD a t eA mo u n tD a t eA mo u n t4 - 24 3 56 4 4 . 9 54 - 24 , 2 7 6 . 8 54 - 21 6 , 8 8 8 . 8 04 - 54 3 63 , 2 6 0 . 0 04 - 32 , 1 3 7 . 5 04 - 31 8 , 2 4 9 . 6 54 - 44 3 71 , 1 8 5 . 7 94 - 51 , 3 5 0 . 4 74 - 41 7 , 0 6 3 . 8 64 - 34 3 87 7 6 . 6 54 - 79 8 2 . 4 64 -

41、51 5 , 1 5 4 . 3 34 - 84 3 91 , 7 8 1 . 7 04 - 81 , 3 2 0 . 2 84 - 71 4 , 6 4 8 . 8 94 - 74 4 01 , 4 8 7 . 9 04 - 9 C M1 , 0 3 6 . 0 04 - 81 1 , 7 6 7 . 4 74 - 84 4 12 , 4 2 0 . 0 04 - 1 12 , 7 2 0 . 0 04 - 91 2 , 8 0 2 . 4 74 - 1 14 4 21 , 5 8 5 . 6 04 - 1 27 5 7 . 4 14 - 1 11 3 , 9 3 6 . 8 74 - 1

42、24 4 31 , 2 2 6 . 0 04 - 1 31 , 2 1 8 . 5 64 - 1 21 3 , 4 6 8 . 2 8= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =4 - 2 9N S F4 2 5 . 6 04 - 2 71 , 5 4 5 . 5 74 - 2 71 3 , 0 0 5 . 4 54 - 2 94 5 91 , 0 8 0 . 3 04 - 2 92 , 9 2 9 . 4 54 - 2 91 4 , 4 2 9 . 0 04 - 3 0D

43、 M3 0 . 0 04 - 3 02 , 1 2 8 . 6 04 - 3 01 5 , 9 0 7 . 4 54 - 3 04 6 16 2 0 . 1 5S y m b o ls :CMCr e d i t Me m oE CE r r o r Co r r e c t i o nNS FNo t S u f f i c i e n t F u n d sRe c o n c i le Y o u rDMDe b i t Me m oINTI n t e r e s t E a r n e dS CS e r v i c e Ch a r g eA c c o u n t P r o m

44、 p t lyReconciliation对账对账 is necessary because the balance per bank银行帐单余额银行帐单余额and balance per books帐簿帐面余额帐簿帐面余额are seldom in agreement due to 1.)time lags 时间延滞时间延滞 2.)errors.Reconciliation should be prepared by an employee who has no other responsibilities pertaining to cash.STUDY OBJECTIVE 7RECONC

45、ILING THE BANK ACCOUNT Steps in preparing a bank reconciliation:1 Determine deposits in transit在途存款在途存款2 Determine outstanding checks未兑现支票未兑现支票3 Note any errors discovered4 Trace bank memoranda to the records Each reconciling item used in determining the adjusted cash balance per books should be rec

46、orded by the accountant who work for the depositor.RECONCILING THE BANK ACCOUNTThe bank statement for the Laird Company shows a balance per bank of $15,907.45 on April 30, 2006.On this date the balance of cash per books is $11,589.45. BANK RECONCILIATONReconciling items can be found in textbook p355

47、Example of BANK RECONCILIATION12204.85Adjusted balance per books 30 bank service charge 425.6Less: NSF check36 error in recording check No.4431035Add: collection of notes receivable ,interest 11589.45Cash balance per books12204.85Adjusted balance per bank statement1502.7 No.4601401.3 No.4573000 No.4

48、53Less: outstanding checks 2201.4Add: deposit in transit 15907.45Cash balance per bank statement Example of BANK RECONCILIATIONCollection of Note Receivable. This entry involves four accounts. Interest of $50 has not been accrued and the collection fee is charged to Miscellaneous Expense. GENERAL JO

49、URNAL Date Account Titles and Explanation Debit Credit Apr. 30 Cash Miscellaneous Expense Notes Receivable Interest Revenue (To record collection of notes receivable by bank) 1035 15 1000 50ENTRIES FROM THE BANK RECONCILIATIONBook Error. An examination of the cash disbursements journal shows that ch

50、eck No. 443 was a payment on account to Andrea Company, a supplier. The check, with a correct amount of $1,226.00, was recorded at $1,262.00.GENERAL JOURNALDateAccount Titles and ExplanationDebitCreditApr. 30Cash Accounts Payable Andrea Company (To correct error in recording check No. 443)3636ENTRIES FROM THE BANK RECONCILIATIONNSF Check An NSF check becomes an accounts receivable to the depositor.GENERAL JOURNALDateAccount Titles and ExplanationDebitCreditApr. 30Accounts Receivable J. R. Baron Cash (To recor