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Case Study CS-1 LO 12 M & G Finances (M& G) is an incorporated tax preparation company

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Case Study CS-1 LO 12 M & G Finances (M& G) is an incorporated tax preparation company. Most of its clients pay for the completion of their tax returns with either a debit or a credit card. The rest pay with cash. M&G employs 20 tax preparers, two supervisors and one manager. The office collects thousands of dollars in cash every day. After a tax return is prepared by one of the 20 tax preparers , a supervisor is responsible for recording Information (e. customer name, amount charged, payment method) related to the return in a log. The receipt of cash is recorded immediately when it is received. Receipts are issued immediately. In numerical order. Copies of the receipts are also kept with the logs. The cash is kept in the drawer of the employee who prepared the tax return. At the end of the day, the cash being kept by the various employees is pooled together and then passed on to the supervisor, who keeps it in her drawer. The cash is deposited into the bank at the end of each work week. Over the past few weeks, the manager has noted that the amount of cash on hand in the office has consistently been less than the amount recorded in the logs. In fact, the difference between the actual cash on hand and the recorded amount is increasing little by little over time. Required a) Is M&G exhibiting any positive aspects in its system of cash controls? Explain. b) What are the negatives in M&G's cash control system? Explain. (You can refer to controls that do not exist or controls that exist but are ineffective).
4 5 Parta - Is M&G exhibiting any positive aspects in its system of cash controls? 6 7 8 9 10 Parta - Explain. 11 12 13 14 15 Part b - What are the negatives in M & G's cash control system? 16 17 18 19 20 21 Part b-Explain. 22 23 24 25 26 27 Partc - Provide 3 suggestions for this company to improve their cash management system. 28 29 30 31 32 33
Case Study CS-1 LO 12 M & G Finances (M&G) is an incorporated tax preparation company. Most of its clients pay for the completion of their tax returns with either a debit or a credit card. The rest pay with cash. M&G employs 20 tax preparers, two supervisors and one manager. The office collects thousands of dollars in cash every day. After a tax return is prepared by one of the 20 tax preparers, a supervisor is responsible for recording Information (e. customer name, amount charged, payment method) related to the return in a log. The receipt of cash is recorded immediately when it is received. Receipts are issued immediately. In numerical order. Copies of the receipts are also kept with the logs. The cash is kept in the drawer of the employee who prepared the tax return. At the end of the day, the cash being kept by the various employees is pooled together and then passed on to the supervisor, who keeps it in her drawer. The cash is deposited into the bank at the end of each work week. Over the past few weeks, the manager has noted that the amount of cash on hand in the office has consistently been less than the amount recorded in the logs. In fact, the difference between the actual cash on hand and the recorded amount is increasing little by little over time. Required a) Is M&G exhibiting any positive aspects in its system of cash controls? Explain. che b) What are the negatives in M&G's cash control system? Explain. (You can refer to controls that do not exist or controls that exist but are ineffective).
4 5 Parta - Is M & G exhibiting any positive aspects in its system of cash controls? 6 8 9 10 Parta - Explain. 11 12 13 14 15 Part b - What are the negatives in M & G's cash control system? 16 17 18 19 20 21 Part b-Explain. 22 23 24 25 26 27 Part c-Provide 3 suggestions for this company to improve their cash management system.