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Alright, let's talk about some examples for internal controls just for cash
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There are some pretty straightforward ones. Effective internal control will protect cash and they should meet three guidelines
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These are what you should follow when you're creating examples of internal controls just specifically for cash
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One is I want to handle cash, or the handling of cash is separate from the record-keeping
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Again, that's the most common one, the separation of duties. I don't want the person with custody of it to be also the one that's doing the record-keeping of it
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of it. Again, you're going to hear this so many times. This is just very important. Another one
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is cash receipts are promptly deposited in the bank. I don't want to have a lot of cash on hand
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that opens the door for theft internally or theft externally with people coming in and maybe robbing
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me or something. When I have cash on hand, I want to take it to the bank as quickly as I can
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Typically, you're going to have some businesses do it twice a day or at least once a day
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And then finally, cash disbursements are made by check or EFT. Why check or EFT
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Because I have a number that's associated with it. I don't want to just give somebody cash because if I give somebody cash
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they can dispute it as my word over theirs. I would much rather give them a check so I have that paper trail to go back to see
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who endorsed it, who cashed it, who was paid to and all that
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So those are three very important guidelines when it comes to controlling your cash
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internal controls for cash. Appreciate it
