Internal Control Questionnaires and Verification Procedures

Custody Accounts

1. Has bank counsel reviewed and approved the type and content of the contracts being used?

2. Does the bank have written contracts on hand for each account that clearly define the functions to be performed by the bank?

3. Has a standard fee schedule for this service been adopted?

4. Does the bank give customers duplicate receipts with detailed descriptions, including dates of coupons attached, if applicable, for all items accepted?

5. Are blank, pre-numbered, multicopy receipts kept under dual control and periodically audited?

6. Are all negotiable items handled in this area maintained under dual control?

7. For coupon securities held by the bank:

   1. Is a tickler file or other similar system used to ensure prompt coupon redemption on accounts for which the bank has been authorized to perform that service?

   2. Are procedures in effect to prevent clipping of coupons when the bank is not so authorized?

   3. Have procedures been adopted to ensure prompt customer credit when coupon proceeds or other payments are received?

8. Have procedures been established for withdrawal and transmittal of items to customers?

9. Does an officer review and approve all withdrawals prior to the transaction?

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