OVERDRAWN CASH AND INVESTMENT BALANCES Page 2
Information and Communication
2) Did management design the entity’s information system and related control activities to ensure correct cash and investment
balances and the proper review of cash and investment balances?
a. Did management implement control activities through written policies?
b. Is access to the accounting records appropriately controlled by user logins and passwords?
c. Do individuals involved in posting the accounting records and preparing the bank reconciliation share their user id and
3) Does management or a designated individual review and check the accuracy of cash and investment balances by comparing them
to other supporting documentation? If yes, is this review documented as evidenced by initials, tick marks, etc. indicating procedures
4) Are the individuals authorized to review cash and investment balances knowledgeable?
5) Are the individuals authorized to review cash and investment balances understand the unit’s accounting system?
6) Is there a checklist for reviewing cash and investment balances that includes the following:
a. Employee names with their responsibilities and duties
b. Deadlines for completing the review of cash and investment balances
c. Detail of supporting documentation required
d. Follow up of negative cash and investment balances
7) Is the budget process working effectively?
a. Are proper estimates and other documents used in the budget process retained and reviewed by management?
b. Are budgets reviewed and approved by the responsible department head?
c. Are budgets reviewed and approved by the governing board?
d. Are budget modifications approved by management and/or the governing board?
e. Are monthly reports detailing disbursements and appropriations provided to the appropriate department to review for accuracy
f. Are monthly reports detailing disbursements and appropriations provided to management to review for accuracy and
g. Are monthly disbursement and appropriation reports reviewed by the governing board?
h. Are comparisons made between budgeted and actual disbursements? Do significant variations require an explanation?
i. Are appropriation balances and cash and investment balances reviewed to determine if sufficient balances exists prior to writing
j. Have controls been established to track periodic or contractual payments made to a vendor in order to properly oversee and
forecast budgeted amounts?
1) Are procedures established to ensure that proper communication and documentation exists for internal communications between
offices, departments, management and the governing board regarding the review of cash and investment balances?
a. How does the unit internally communicate information to employees regarding cash and investment balances, including
responsibilities for internal control? Are records maintained to document this communication?
b. Are procedures established to ensure that the communication requirements are being followed and necessary information is
being communicated properly?
2) What procedures are in place to collect the information needed to complete a proper review of cash and investment balances?
a. Does management use the most current information available to ensure cash and investment balances are correct?
1) Are internal controls over the review of cash and investment balances evaluated and adjusted for weaknesses on a regular basis?
For example, personnel changes, newly elected officials, new technology, etc.
a. What follow-up action is taken for identified problems or weaknesses in internal controls rover cash and investment balances?
2) Are monthly reports detailing receipts, disbursements, cash and investment balances and appropriations of the funds provided to
the appropriate department to review for accuracy and reasonableness?
3) Are monthly reports detailing receipts, disbursements, cash and investment balances and appropriations provided to management
to review for accuracy and reasonableness?