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Finance & Accounting
Pages 5 (1255 words)
DISCUSSION 1: "Government Financial Statements" Please respond to the following: Go to the White House’s Website to read the article titled “OMB Circular A-123—Management’s Responsibility for Internal Control,” dated December 21, 2004, located at http://www.whitehouse.gov/omb/circulars_a123_rev.
Be prepared to discuss. From the first e-Activity, note that the GAO could not issue an opinion on the financial statements of the US government. Evaluate how this could occur considering the requirements of OMB Circular A-123. What steps would you take to alleviate the internal control problems? Differentiate between the requirements for internal controls in government agencies and those in public companies. As per the requirement of OMB Circular A-123, we can understand the changes took places created much vulnerability in financial reporting system. This emphasized more on the term on “Internal Control” from the term “Management Control”. This may exclude many facts which should have reported earlier with obligations. In new requirements “Defines materiality for the purposes of assessing and documenting internal control over financial reporting”, this option can create loop for many important facts and figure than clearly presenting it in the financial reporting. It has created ambiguity for three different processes, they are: a) security across the government, b) improper payments and c) tax collection activities. To alleviate the internal control, the expense item I would prefer the bring in clear consideration withdrawing the category as reportable status. ...
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