COMMON AUDIT ISSUES
Accounting for Receipts
We are in the midst of another round of revenue producing activity audits in which one step is to examine controls over external receipts - cash and checks. To date, we have found many activities reviewed did not have adequate controls. Poor internal control over external receipts has been a major contributor to frauds our office has investigated over the years.
To assure your department has good internal controls over external revenue, the individuals handling receipts must be not have recordkeeping/reconciling responsibilities. That is, persons handling cash/making deposits should not be responsible for reconciling deposits to SFS or the Foundation Ledger statements. The individual with reconciliation responsibilities should also reconcile the deposit to the original receipt record (cash register tapes or some other log of money received.) not the deposit form.
Internal Audit's website also discusses controls over receipt handling. See Receipts/Revenue Handling or Self Assessment Tools.
Business Services News - March 2005