Question

company policy for internal control should include all of the following except for which one?

• monthly bank statements should be sent to and reconciled by the same employees who authorize payments and write checks.
• at time of payment, all supporting invoices or documents will be stamped \paid.\
• the owner (or responsible employee) signs all checks after receiving authorization to pay from the departments concerned.
• employees will be rotated.

question 2 (5 points)

the bank statement shows

• the beginning bank balance of the cash at the start of the month.
• the checks the bank has paid and any deposits received.
• any other charges or additions to the bank balance.
• all of the above

Explanation:

Analyze internal control policies

The first question asks which policy should not be included in a company's internal controls.

• Having the same employees authorize payments, write checks, and reconcile bank statements violates the core principle of Internal Controls, specifically segregation of duties. Reconciliations must be performed by someone independent of cash disbursements.
• Stamping invoices "paid" prevents duplicate payments.
• Requiring authorized signatures on checks ensures validity.
• Rotating employee duties reduces fraud risks.

Therefore, the first option is the exception.

Analyze bank statement contents

The second question asks what a bank statement shows.

• It lists the starting balance of the account at the beginning of the period.
• It details cleared checks (payments) and deposits received during the period.
• It includes other bank charges (like service fees) or additions (like interest earned), which are key elements in a Bank Reconciliation.

Since all three statements are correct, the correct choice is "All of the above".

Answer:

Question 1

• (A) Monthly bank statements should be sent to and reconciled by the same employees who authorize payments and write checks. (Correct answer)
• (B) At time of payment, all supporting invoices or documents will be stamped "paid."
• (C) The owner (or responsible employee) signs all checks after receiving authorization to pay from the departments concerned.
• (D) Employees will be rotated.

Question 2

• (A) the beginning bank balance of the cash at the start of the month.
• (B) the checks the bank has paid and any deposits received.
• (C) any other charges or additions to the bank balance.
• (D) All of the above (Correct answer)