Question

What types of policies, procedures and controls can companies put in place to safeguard, reconcile and trace cash?

Answer 1

Policies

• make proper vouchers for the cash payments done
• restrict cash amount to be kept in hand on lower as well as higher limits. If excess cash in hand, deposit in bank and if lower cash in hand then withdraw from bank

Procedures

• make a cash budget and determine the optimum cash to be kept in hand
• make a list of fixed payments of utilities and salaries to be paid in cash and provision them
• for any unexpected expense make sure to follow due procedure of authortization from designated person for payment

Controls:

• segregation of duties and dual authorization procedures before allowing any payment
• make a register for a cash count on basis of denominations, duly signed by two persons daily who counted cash

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