Generally, the primary incompatible duties that need to be segregated are:
- Authorization or approval.
- Custody of assets.
- Recording transactions.
- Reconciliation/Control Activity.
What are some examples of segregation of duties?
The following are illustrative examples of segregation of duties.
- Vendor Maintenance & Posting Invoices. ...
- Purchase Orders & Approvals. ...
- Payments & Bank Reconciliation. ...
- Paychecks & Bank Reconciliation. ...
- Journal Entry & Approvals. ...
- Custody of Cash & Account Receivable Reconciliation. ...
- Hire & Set Compensation. ...
- Hire & Approve Hire.
What sort of duties would be segregated within the sales process?
Separate individuals hold responsibility for authorization, approval, accounting and asset custody when a sales department segregates duties. Authorization includes requests for purchases. Approval of purchases must take place before purchases can be made.
