The paper 'The Internal Control System' is a perfect example of a finance and accounting assignment. The internal control system which was missing and would help to reduce the chances of fraud are as improved monitoring: It is imperative that the restaurant looks at increased monitoring which can be achieved to a large extent. The process would help to verify the actual data and match the values. In case any discrepancy arises the same can be sorted out. The process can also be instigated by having external agent hired for the process who carries out the process of monitoring and ensuring that no frauds take place.
The role of the agent to be work on behalf of the owner and to carry out the process of monitoring. This will reduce the chances of frauds as the fear of being caught would prevent such incidents and would provide the required framework through which better business performance will be achieved. Improved Accounting: The process of accounting also needs to be improved and a mechanism needs to be adopted where the verification process improves. At the forefront, the bills which are issued should be automatically number and no one should be allowed to make any changes in it.
The same should be entered in the cash register so that there is no mismatch between the bill value and the values entered. This process will prevent the cashier or any other person to remove the bills in between and would provide an opportunity to verify all the records. The process can be further improved by having a mechanism where physical verification of the bills are done with the actual payments received and entered so that any discrepancies can be resolved.
Improving the mechanism of accounting will help to take care of the different transactions and will improve the process through which books of accounts are maintained. Continuous Verification: The process of verification needs to be improved. Since the business deals in petty cash so the process of verification needs to be carried out daily. It is important that all the bills which are issued are matched with the bills which are entered and the same is verified with the closing balance.
This needs to be done every day as it will help to measure the cash balances every time. The process will help to verify the cash values and will provide an opportunity through which the cash balance maintenance process will improve. Improved Auditing: The restaurant can also look to take the help of the auditors and ensure that the books are audited on a regular basis. This will help the owner to certify that all the transactions are correct as the auditor will look at ensuring that the details which are provided are correct and true.
The process of auditing should be carried out by external parties and should be done on a continuous basis. This can be matched by random checking where the auditor or the owner carried out the checking randomly without informing the cashier. This will create a fear in the mind of the cashier that any frauds will be caught and would prevent the person from carrying out such acts. The process would lead towards improving overall efficiency and would help to develop the required process through which better controls will be exercised over the business.