Reference no: EM131284753

The local county fair has provided enjoyment for area residents for Inany years. In recent years, attendance at the nine-day fair has increased, and the fair officials recognize the need to improve the controls over cash receipts. They asked you 10 observe the collection of admission fees at the main entrance to the fairgrounds, investigate how cash receipts are recorded, and recommend improvements that can be impletnented next year. The facts you obtained from performing these proceclures are documented in the following paragraphs.

TV,'O employees were positioned at the main entrance to collect the admission fees (SIO för adults and $5 for senior citizens and children under 12; parking was free) as two streams of cars entered the fairgrounds. Each pair of employees worked a three-hour shift each clay. At the end of each shift, the employees who had worked that shift transferred the cash collected to the next shift's employees as those employees arrived at the main entrance.

When the main entrance closed each evening, one of the employees who worked the last shift delivered the daily proceeds to the collections supervisor, who was otherwise not involved in the collection of admission fees during the clay. The collections supervisor countecl the cash in the presence of the employee and locked it in the drawer of his desk located in the fhir office building. Early each moming, the collections supervisor delivered the cash collected the previous day to the bank and received a validated deposit slip that provided the basis for his daily entry in the cash receipts journal. When he subsequently received the bank statement, he compared the total cash receipts posted in thc cash receipts journal to the total recorded by the bank to Inake sure they were the same.

Although the fair officials recognized the need to improve the admission fee internal control system, they decided that the costOf purchasing a safe, cash registers, or any other mechanical devices, installing sales booths, or otherwise altering the physical layout of the main entrance would greatly exceed any benefits that might be derived. However, the officials did agree that the sale of admission tickets Inust be an integral parl of the improvement efforts. They also acknowledged thal there may be a need to hire more employees to work at the main entrance.

Clearly and concisely recommend specific controls the fair officials can implement next year to improve controls over the collection and recording of admission fees. Organize your reconmnendations in the form of a list.

Example:

Issue prenumbered admission tickets when the admission is received. (Note: You Inay use this illustrative e.xample in your answer.)