Internal Control Questionnaires and Verification Procedures

Safekeeping and Custody Accounts

1. Obtain control, through use of seals or otherwise, of items held in safekeeping and custody accounts.

2. Obtain the safekeeping register, verify that receipt forms are issued in numerical sequence and that all numbers are accounted for, and check unused forms for the next number to be issued. Also, test the completeness of the numerical sequence of unissued forms.

3. Using an appropriate sampling technique, select items for testing, and:

   1. Examine the contract and check for the customer signature for each account selected.

   2. In the presence of a bank official, examine the items selected, agreeing the vault contents to the receipt copies on hand.

   3. Review transactions, and determine compliance with written contractual authorizations.

   4. If any items selected for examination are held in safekeeping elsewhere, confirm their existence by direct communication.

   5. If any of the items selected for examination appear altered or there appears to be a discrepancy between the receipt and what is held in the vault, confirm the items with customers.

4. Using an appropriate sampling technique, select certain closed accounts (released items) for examination, and:

   1. Examine the register form and the customer’s release.

   2. Compare the customer’s signature on release to the other signature copy on file.

   3. If any of the items appear altered or unusual, confirm the correctness of information with owners.

5. Review the policies or practices for the collection of fees for these services, and perform appropriate tests to ensure compliance.

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