Cash Receipt Control:

Cash receipt control can be discussed with respect to OVER-THECOUNTER RECEIPTS and MAIL RECEIPTS. We will talk about OVER-THECOUNTER RECEIPTS mostly.

Over-The-Counter Receipts:
Establishment of Responsibility:
There are two shifts in the supermarket, which is the subject of our
study. In each shift, there is only one person in the Point of Sale(POS).
Each person has own user name and password.
Segregation of Duties:
After the end of each shift, the software data is automatically
transferred to the accounts department. And the cash is sent to the
head cashier. Later the accounts department send the details to the
head cashier, who then reconciles the cash and record. The next
morning the cash is deposited to the bank account. About 50% of the
sales are paid through credit cards and such other facilities. So, these
are already done as bank transaction, thus requirement for cash
handling is substantially lessened.
Weakness:
The head cashier has the sole responsibility with both the cash and the
record, thus he has the opportunity to defraud. Head cashier, in
allusion with the accounts department can also perpetrate fraud. But IT
Department and manager both separately check the computer records
and online bank statement, so such occurrences are not kept unnoticed
for long.
Documentation Procedures:
Remittance advices, invoice, computer records, deposit slips- all are
maintained in the supermarket. But with the increasing usage of online
payment and software records, hardcopies are decreasing day by day.
Still most of purchases are still done by invoices, those are mostly
maintained by the manager.

Physical Control:
Cash is stored to the nearby bank by the head cashier daily. Limited
amount of cash is reserved under the supervision of the accounts
department. Only with the signatures of MD and ED, the cash is
disbursed.
Independent Internal Verification:
IT department checks the software records of cash from POS to
accounts department and reports to the manager. Manager has access
to the online bank statement, so he matches the records and accounts
almost daily basis.
Human Resource Controls:
Mostly head cashier handles the biggest amount of cash; the
accountant handles some when to disburse. These two personnel are
bonded. They are also very reliable persons based on their previous
actions. But because there are only two persons to conduct the
departments, it is not possible for the management to force them to
take vacations or switch duties between persons.
Cash Over and Short Account:
In many instances, cash and accounts record do not match. If cash is
surplus, cash over is accounted but no action is taken. If otherwise
happens, that is, cash is substantially shorter than the record, the
cashier at POS is held responsible and he/she needs to pay the
difference.

Mail Receipts:
All the mails are received with the sign of the manager. In absence of
the manager, supervisors sign the documents. But later it is verified by
the manager. At times the manager has to inform his superiors of
documents.
Weakness:
There are no two persons while signing the mail receipts, so this
section is vulnerable to fraud. But there is also a cost-benefit spectrum
of internal control. It is not cost effective of the organization, if it tries
to ensure the duality rule for such receipts. Moreover, the organization
has excluded this section through risk assessment.

Cash Disbursement Controls:

Voucher system:
To control cash disbursement, voucher system is mostly used. If a sale
order is to pass, first a demand-paper is issued from the floor
supervisor. Then the sales department makes necessary requisition.
Only after the manager verifies, ED puts his signature in the voucher.
And accounts department allows the cash to be disbursed. Mostly the
organization tries to use EFT (electronic funds transfer) rather than
cash.

Petty Cash Fund:

The organization does not use any petty cash fund. Everything needs
to be issued through the supervisors authorization. We have seen the
manager to use simple notes while issuing small amounts.
Weakness:
Though the control resists fraud but it is very authoritarian, thus time
consuming.