Page 298 - COSO Guidance Book

Exhibit 8-3: Illustration of narrative and systems flowchart (continued)

The cashier recounts the cash and prepares the daily deposit. If the cash does not equal the
total amount on the mail-receipts list, then the cashier takes appropriate action, such as
notifying management of the discrepancy. The cashier takes the deposit to the bank and
obtains a duplicate deposit ticket, which is attached to the mail-receipts list sent to the
cashier by the mail-receipts department. These two documents are filed by date. Other
aspects of this system not included in the flowchart are as follows:

1. The general-ledger department posts to the accounts-receivable control account
monthly.
2. As part of the monitoring function, the internal auditor will select a sample of days and
compare the information on the copy of the mail-receipts list in the mail-receipts
department with the mail receipts held by the cashier and the bookkeeper. The internal
auditor will trace postings from the mail-receipts list to individual accounts in the
subsidiary accounts-receivable ledger. The total cash to be deposited and the date on the
mail-receipts list will be compared with similar data on the duplicate deposit ticket with
the amount on the bank statement. Finally, the internal auditor will select a sample month
to ensure that the amounts posted to the accounts-receivable control account are
correct.

A flowchart of this process follows. Note that, to keep the flowchart concise, procedures
performed by the general-ledger bookkeeper and the internal audit department are not
presented. Also, there is no terminal “end” symbol presented because this is a partial
description of the overall system.

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