In your capacity as a staff assistant, you have worked on a number of audits during the year. Listed below are a list of possible internal control weaknesses that you have noted in your working papers:

1. Cash is deposited intact every second day.

2. The cashier makes bank deposits, records cash transactions, and reconciles the bank statements.

3. The board of directors of a mulinational company delegates the authorization of capital budgeting expenditures of less than \(\$ 500,000\) to the vice-president of manufacturing.

4. The reconciliation of the bank statement is made by a subsidiary ledger accounting clerk who does not have access to cash.

5. Office supplies in a manufacturing company are stored in an unlocked closet in the office.

6. The write-off of bad debts is authorized by the accounts receivable clerk whenever a balance is 6 months past due.

7. Prenumbered receiving reports are not used in the receiving department.

8. An accounting clerk maintains both the general ledger and the accounts payable ledger.

9. The shipping department orally notifies the billing department of goods shipped.

10. Storeroom personnel and all foremen have access to the raw materials storeroom.

11. The preparation and mailing of monthly statements to customers is done by the clerk responsible for maintaining the customer's balance.

Required:

a. Classify the weaknesses as (1) no weakness, (2) immaterial weakness, and (3) material weakness. Give the reasons for your answer.

b. For immaterial and material weaknesses indicate the internal control principle(s) that has been violated.

c. Indicate your suggestions for eliminating any immaterial or material weaknesses.