Bookkeeping For Dummies, 2nd Edition
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Although bookkeepers are the ones who record what happens to your business’s cash, they aren’t the only ones who control where that cash goes. Controlling your company’s money is important; a business’s cash can be a pretty tempting siren for employees who aren’t accountable to the right checks and balances. Follow these suggestions to limit any one person’s access to your company’s money:

  • Separate cash handlers. Be sure that the person who accepts cash isn’t also recording the transaction.

  • Separate authorization responsibilities. Be sure that the person who authorizes a payment isn’t also signing the check or dispersing the cash.

  • Separate the duties of your bookkeeping staff to ensure a good system of checks and balances. Don’t put too much trust in one person — unless it’s yourself.

  • Separate operational responsibility (actual day-to-day transactions) from record-keeping responsibility (entering transactions in the books).

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Lita Epstein, MBA, designs and teaches online courses in investing, finance, and taxes. She is the author of Trading For Dummies and Bookkeeping Workbook For Dummies.

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