Thursday, January 11, 2024

Internal Controls Week - Part 4 - IC Quick Reference

 

INTERNAL CONTROLS (IC) QUICK REFERENCE

 

ICs are a risk prevention and a risk mitigation system; an accounting process and an element of organization’s culture

 

Segregation of duties IS THE MOST IMPORTANT control

 

The objective is reasonable assurance NOT perfection

 

Basic techniques are well known and must be implemented

 

          Policies and procedures custom designed for organization

          Employee screening, training, retraining and supervision

          Relentless (not nasty) supervision and support

          Accounting system elements design fitted to the company

                   Approval and authorization

                   Document movement and retention paths

                   Physical control of assets

                   Verification processes

                   Reconciliations of transactions/documentation/ cash

                  

Information system controls designed for the organization

External review and audit used as required

 

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