Which statement reflects proper deposit frequency?

Which statement reflects proper deposit frequency?

• A. Bank deposits or remittances to the city treasurer should be made daily.
• B. Deposits should be made only monthly.
• C. Deposits should be made only when the drawer is full.
• D. Deposits are optional.

Answer: (A)

Timely deposit of city funds is the concept being tested. Deposits should be made daily because moving cash receipts to the city treasurer promptly protects funds, supports accurate daily reconciliations, and strengthens internal controls by reducing the amount of cash on hand. Daily deposits lessen the risk of loss, theft, or error and make sure the cash balance reflected in the records matches the actual bank deposits in near real time. Depositing only monthly would leave funds on hand too long, increasing risk and complicating accounting. Waiting until a drawer is full introduces an arbitrary threshold and can create gaps in cash handling and reconciliations. Deposits being optional conflicts with fiduciary duties and the need to safeguard public money.

Timely deposit of city funds is the concept being tested. Deposits should be made daily because moving cash receipts to the city treasurer promptly protects funds, supports accurate daily reconciliations, and strengthens internal controls by reducing the amount of cash on hand. Daily deposits lessen the risk of loss, theft, or error and make sure the cash balance reflected in the records matches the actual bank deposits in near real time.

Depositing only monthly would leave funds on hand too long, increasing risk and complicating accounting. Waiting until a drawer is full introduces an arbitrary threshold and can create gaps in cash handling and reconciliations. Deposits being optional conflicts with fiduciary duties and the need to safeguard public money.