Preparing Comprehensive Bank Reconciliation with Theft and Internal Control Deficiencies

    Scenario Daisey Company is a very profitable small business- It has not, however given much consideration to internal control- For example, in an attempt to keep clerical and office expenses to a minimum, the company has combined the jobs of cashier and book- keeper. As a result, Bret Turin handles all cash receipts, keeps the accounting records, and prepares the monthly bank reconciliations- The balance per the bank statement on October 31, 2017, was $18,380- Outstanding checks were No- 62 for $140.75, No- 183 for $180, No- 284 for $253.25, No- 862 for $190.71, No- 863 for $226-80, and No- 864 for $165.28- Included with the statement was a credit memorandum of $185 indicating the collection of a note receivable for Daisey Company by the bank on October 25- This memorandum has not been recorded by Daisey- The company's ledger showed one Cash account with a balance of $21,877-72- The balance included undepositied cash on hand- Because of the lack of internal controls, Bret took for personal use all of the undeposited receipts in excess of $3,795-51- He then prepared the following bank reconciliation in an effort to conceal his theft of cash: I have attached Daisy Company’s financial statement- Assignment Steps (1 page of the problem solving on the Excel sheet and 4 pages of the word document report)     Prepare a 1,050-word bank reconciliation report (hint: deduct the amount of the theft from the adjusted balance per books) including the following: 0 Introduction 0 Indicate the three ways that Bret attempted to conceal the theft and the dollar amount involved in each method- 0 What principles of internal control were violated in this case? 0 Conclusion