Internal Control Questionaire

INTERNAL CONTROL QUESTIONAIRE

ACCOUNTS PAYABLE, ACCURED LIABILITIES, AND OTHER LIABILITIES

Objectives: To ascertain that controls exist to insure that all current unsecured liabilities are properly identified and recorded.

1. Are the liability control accounts reconciled at frequent intervals (at least monthly) with subsidiary records?

2. Are bid deposits and similar receipts properly recorded and recognized as liabilities when received?

3. Are accounts payable maintained independently of cash receipts and disbursement functions?

4. Is there a system for comparing the invoice, purchase order, and receiving report prior to entry of the account payable in the accounting record?

5. Are accounts payable adjustments properly:

a. Reviewed?

b. Approved?

6. Are year-end cutoff procedures adequate to insure inclusion of all items purchased during the period?

7. Does a policy exist that requires payments to vendors be made within the discount period in order to take advantage of all offered discounts?

8. Are lost discounts properly recognized in the accounting system?

9. Do procedures exist to prevent duplicate payments?

10. Are procedures adequate to avoid duplication of payments for transportation charges?

11. Are returned purchases controlled in a manner which assures proper credit?

12. Do procedures preclude payment for damaged or spoiled goods?

13. Are debit balances in accounts payable reviewed?

ACCOUNTS RECEIVABLE

Objectives: To ascertain that controls exist to insure that all unsecured amounts due the organization are properly identified and recorded.

1. Are credit and collection policies in writing and properly approved?

2. Are accounts receivable maintained independently of cash receipts and

disbursement functions?

3. Are noncash credits, bad debt write-offs, credit memos and allowances:

a. Approved independently of processing, recording, and collecting the charge?

4. Is the total of the individual accounts independently reconciled at...