Internal control of a company is always very important in the
operation of a business. This does not only apply to large companies,
but also to small businesses For the topic we are discussing this
week, internal controls are necessary for companies like those in the
restaurant industry. That's because research shows that about 75
percent of employees have stolen from their employers once and
about 38 percent have stolen at least twice(TRTG). The company's
operations and profits have suffered a direct impact due to the
recurrence of similar behaviors. As a result, restaurant managers are
realizing the importance of Control cash receipts. For better control,
some restaurants use customer checks with pre-numbered sequence
codes. b The purpose of this control is to create a written record of
cash and checks received. The original receipts should be given to
the person receiving the money; copies should be kept permanently.
Eventually, the total amount of receipts issued should be compared
to the amount deposited in the bank (Delano). b
By using pre-numbered serial codes, any transactions that are not
properly recorded or not recorded at all can be effectively detected
in the restaurant. b Also, when counting checks, if any are found to be
missing, then it is easy to narrow down who is responsible for the
error and therefore, helps to detect any fraud in the restaurant. With
this type of control, the restaurant's management has a clear picture
of what transactions are actually occurring in reality, thus reducing
the potential for company losses. In addition, to better control cash
transactions, companies can implement some of the following
practices. Require background checks on employees, establish
segregation of duties, and secure all cash and assets in a secure
location. Other useful cash receiving controls include making daily
bank deposits, reconciling accounts and reviewing bank statements
at least monthly, and maintaining a vigilant record of cash in accounts
receivable. Establish procedures to conduct petty cash fund reviews
and have supervisors approve all voided transactions and returns
(Reciprocity).
Reference:
Romney, M. B., Steinbart, P. J., Summers, S. L., & Wood, D. A. (2020).
Accounting Information Systems (15th ed.). Pearson Education (US).
TRTG. August 15, 2018. 10 Tips To Stop Your Employees From
Stealing.
https://restauranttechnologyguys.com/10-tips-to-stop-your-
employees-from-stealing/
Delano. Are you Using Internal Controls
http://www.delanoconsulting.com/internalcontrols.html
Reciprocity. January 11, 2021. What are Internal Controls for Cash
https://reciprocity.com/resources/what-are-internal-controls-for-
cash/
