What is a key prevention method to avoid cash handling discrepancies?
Understand the Problem
The question is asking for a key method to prevent discrepancies that may occur when handling cash, examining different strategies that businesses might use to ensure accurate cash management.
Answer
Separation of duties is crucial to prevent cash handling discrepancies.
A key prevention method to avoid cash handling discrepancies is the separation of duties, which involves having different employees responsible for preparing and making cash deposits to establish a system of checks and balances.
Answer for screen readers
A key prevention method to avoid cash handling discrepancies is the separation of duties, which involves having different employees responsible for preparing and making cash deposits to establish a system of checks and balances.
More Information
Separation of duties minimizes the risks associated with errors or fraud by ensuring that no single individual has control over all steps of a cash handling process. This can prevent intentional manipulation or oversight mistakes.
Tips
A common mistake is assigning all cash handling tasks to a single individual, which increases the risk of discrepancies due to lack of oversight.
Sources
- Best practices for cash handling - dtiq.com
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