Cash Due From Lesson Flashcards
Example of cash items
Food stamps and checks issued by the Treasury or other US Government agency such as a tax refund from the IRS
Which would raise a red flag for cash item
Cash items that has been held for more than 30 days may not be bankable assets and should be considered for charge-off. Old items may indicate a lack of adequate oversight of the area
May not be a red flag for cash items
- cash items held for more than 15 days
- tax refund check from IRS deposited in October
- food stamps in a branch in an upper income area
What is the minimum number of bank employees that are needed to count and balance ATM cash and deposits
2
Example of posing ATM risks to a bank
-allowing service providers to perform ATM maintenance alone increases the likelihood of misappropriation of cash. In addition, ATM receipt paper should be routinely replenished to ensure that all transactions are recorded. Without such record, the bank would be unable to verify
the transactions if an error or accounting problem were to arise.
Example of NOT posing ATM risks to a bank
- Mailing ATM cards and PINs separately
- Limiting the dollar amount and number of times cash can be withdrawn from an ATM in any given day
Example of how a bank control unissued and capture ATM cards
Place them under joint custody to prevent any one person from being able to issue a card and PIN and
accessing a customer’s account
Example of how NOT a bank control unissued and capture ATM cards
- Keep them in a locked desk that only one employee has access to
- Ensure that the ATM alarm system is functional at all times
- Check the supply of ATM paper weekly
Where are correspondent banks used
used to transact business with financial institutions across the country and around the world, not just in foreign countries
Which situation would be a potential concern for correspondent account
- the increased transaction size in one of the correspondent accounts, as this may indicate potential fraud.
- concerned if the President reconciles the correspondent account. Someone with that level of authority could use threats to get a subordinate employee to execute fraudulent transactions, then cover up the transactions in the reconcilement
Which situation would NOT be a potential concern for correspondent account
- The bank has daily activity in each of its correspondent accounts.
- The bank reconciles its correspondent accounts weekly.
True or False - a single teller should open the night depository and record each transaction in his or her teller terminal
False - each morning 2 tellers should record the night deposits in a ledger, which includes the date, the customer’s name, total deposit, total cash deposit and any other items related to the deposit.
Give an example of 2 observations an examiner should be concerned with
- one person is able to both count and record deposits
- bank’s night deposit ledger is incomplete
Give an example of controls in place to minimize the risks associated with teller operations
- Monitoring employee accounts at the bank for unusual deposits or transfers
- Using recording cameras at the teller line
- Using buy/sell tickets to document the sale/purchase of cash between tellers
Give an example of reviewing teller operations that you would be concerned about
- 2 tellers share one drawer
- internal audit conducts cash counts of teller drawers on the 2nd Monday of each month. It should be random and surprise counts
