Unit 6.pdf - Student Steven Saint Date Instructor Tech...

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1. Student: Steven Saint Date: 12/9/16 Instructor: Tech Support, Wendy Styron, Chris Marsh, Renee Sinclair, Jennifer Agee, Dee Wessler, Kimberly Garrett, Jennifer Byrom, Kristy Hawkins, Faculty Services, Dawn Dunson, Chris Marsh, Hannah Doggett Course: BBA2201-15N-1 Assignment: Unit VI Homework Internal controls are designed to safeguard assets, encourage employees to follow company policies, promote operational efficiency, and ensure accurate accounting records. Requirements 1. Which objective do you think is most important? 2. Which objective do you think must the internal controls accomplish for the business to survive? Give your reason. Requirement 1. Which objective do you think is most important? is most important. Safeguarding assets Requirement 2. Which objective do you think must the internal controls accomplish for the business to survive? Give your reason. Businesses need to to survive. If this is not done . safeguard assets assets may slip away which is ultimately throwing away resources
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2. 1: More Info 2: Requirements The following situations suggest a strength or a weakness in internal control. (Click the icon to view the situations.) 1 requirements . Read the 2 Requirement 1. Define internal control. Internal control is and all the related measures designed to do the following: the organizational plan (Only complete the necessary answer boxes.) Safeguard assets Encourage employees to follow company policy Promote operational efficiency Ensure accurate and reliable accounting records Requirement 2. The system of internal control must be tested by external auditors. What law or rule requires this testing? The requires the system of internal control to be tested by external auditors. Sarbanes-Oxley Act Requirement 3. Identify each item as either a strength or a weakness in internal control and give your reason for each answer. a. Top managers delegate all internal control procedures to the accounting department. Weakness The control environment would be more effective if top management led in establishing controls. b. Accounting department staff (or the bookkeeper) orders merchandise and approves invoices for payment. Weakness Accounting should not order goods. They could have goods sent to their homes and approve payment. c. Cash received over the counter is controlled by the sales clerk, who rings up the sale and places the cash in the register. The sales clerk matches the total recorded by the register to each day's cash sales. Weakness The sales clerk should not have access to the cash register total, as the clerk could change the record. d. The employee who signs checks need not examine the payment packet because he is confident the amounts are correct. Weakness The officer should examine the payment packet to ensure that the payment is for the correct amount.
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