Internal Control - Essay Example

Free
Today most organizations utilize computerized accounting systems. The employee that bares the responsibility over the design and functionality of the internal control system of a company is its comptroller. A good internal control system relies on the delegation of responsibilities to the different members of the accounting staff. Internal control systems must be constantly maintained. When designing an internal control system it is important to remember the accounting materialism principles which states that information is only useful if its benefits outweigh the costs. Training and development is often needed to educate the employees in internal control. Internal control measures are used to protect and monitor cash, account receivables, payroll, and inventory among other things. In 2002 the government of the United States passed the Sarbanes-Oxley Act (SOX). This act was a revolutionary legislation that was created to increase the confidence of investors in the stock market due to the fact that the marketplace had been flooded with accounting scandals such as Enron and WorldCom. One of the benefits of the Sarbanes-Oxley Act is that it increased the internal control requirements of public companies. ...Show more

Summary

One of the most important business functions is accounting. Accounting deals with the recording, tracking, and monitoring of financial transactions. The end result of the accounting cycle is the preparation of financial statements. Due to the importance of accounting companies must implement internal controls in order to protect itself…
Author : kosseliane
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"Internal Control"
with a personal 20% discount.
Grab the best paper

Related Essays

Love the importance of internal control in auditing.
The basic objective of an auditor is to obtain audit evidence which is sufficient and appropriate in the circumstances that the financial statements are free from material misstatement. These misstatements may occur due to fraud or error. The auditor obtains this audit evidence by obtaining an appropriate level of assurance that financial statements are not materially misstated. The audit evidence thus obtained allows the auditor to report on the financial statements.
10 pages (2500 words) Research Paper
Internal Control and Risk Evaluation
This creates a risk to sales department that may result to loss of revenue due to misclassification of clients; bad debtors may be classified good thus raising the dad debts percentage within the firm. The firm should identify ways of prescreening new clients, either by examining their previous bank statements, statements of financial position and consulting their business partners to establish their credit rating.
3 pages (750 words) Essay
Justification for an Internal Control System
The system provides modalities of directing, monitoring and measuring an organization’s resources. This system plays a significant role in preventing and detecting fraud with the objective of protecting a firm’s resources (Chorafas, 2001). Case Study An organization controller has the task of convincing the management of an electronics retail store, on the need for an internal control system.
3 pages (750 words) Essay
Internal Cash Control
This is because the checks issued are not pre-numbered as a result, there is no preferable order on how the treasurer or the purchasing agent issues the checks thus, no one can be held responsible for any check loss. In addition, the checks are not safe because they are kept in an unlocked file cabinet (Kimmel, Weygandt & Kieso, 2011).
3 pages (750 words) Essay
Audit and Internal Control Issues
The first part of the report identifies the major risks, which the company faces at present and the ways in which these risks can be eliminated. In the second part, the report discusses the information required and procedures to be performed for the purpose of audit planning and risk assessment of the entity.
6 pages (1500 words) Coursework
The Audit Report and Internal Control Evaluation
These issues have been highlighted in the audit report presented as under: Anderson, Olds and Watershed, LLC Certified Public Accountants Shoetown ME 00001 Independent Auditor’s Report To the Stockholders Apollo Shoes Incorporation We have audited the accompanying balance sheets of Apollo Shoes Incorporation, as of 31st December 2007 and the accompanying income statement, statement of changes in equity and cash flow statement for the year ended 31st December 2007.
3 pages (750 words) Essay
Risk Assessment: Internal Control Evaluation from an Auditors Point of View
A company should have a system of controls that guarantees proper financial reporting is established. Recently, internal controls have become significant for companies. This is because activities have become more complex and riskier than in earlier times.
5 pages (1250 words) Term Paper
How does the western model of Internet Banking apply to Russia?
The research study is described as a process rather than an event to mean that in order for the researcher to successfully achieve the research aim that is set for the study, there are series of tasks that must be performed. There could not be a singular activity that could make the researcher achieve the research aim (Adams and Lamptey, 2009).
16 pages (4000 words) Dissertation
Find out how much would it cost
to get a custom paper written by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
YOUR PRIZE:
Apply my DISCOUNT