USA Cash in transit

[mlederer]

Does anyone have any input on what controls you use to manage cash in transit/clearing specifically, related to cash wire transfers out to third parties, not IC. Wires which do process through AP subledger but rather direct from Treasury.

Do you book those to a separate CIT/clearing account and ensure the balance is cleared by period end? Do you require cleared by would you require GL coding to be provided upfront prior to the wire processing?

Any inputs on controls in place around cash in transit would be appreciated.

 

[kirby]

Best Practices to Prevent Wire Transfer Fraud - Morrison Clark & Company CPAs (morrisonclarkcompany.com)

Start with reading the above to begin to establish internal controls over the wire transfer process. Then do not stop there. Look on the Internet for additional knowledge on the subject. Another site mentioned setting a dollar limit per wire, which is a good control but consider the average wire amount of your business when setting such a limit.

Wire transfers are sent immediately so using a "cash in transit" GL account makes no sense. Money is not in transit, It is GONE like lightning!
So, you may as well make a direct credit to Cash when you send the wire. You might consider doing a daily bank recon if you have a high volume of wires.