13_Internal_Controls_Part_2

13_Internal_Controls_Part_2 - 1 Internal Controls 2 Lect 13...

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Unformatted text preview: 1 Internal Controls 2 Lect 13 ` Review ` Internal control defined ` Preventive, detective, and corrective controls ` Common control activities ` More case examples Overview ` An internal control system consists of the various methods and measures designed into and implemented within an organizational system to achieve the following four objectives: Internal Control Defined ` safeguard assets ` accuracy and reliability of accounting information ` promote operational efficiency ` encourage adherence to company policies. Preventive, Detective, and Corrective Controls ` Preventive controls are those that management puts in place to prevent problems from occurring. ` Detective controls alert us when the preventive controls have failed ` Corrective controls are procedures a company uses to solve or correct a problem. ` A good audit trail ` Sound personnel policies and practices ` Separation of duties ` Physical protection of assets ` Internal reviews of controls Common Control Activities ` Internal reviews of controls ` Timely performance reports ` The Fairfax Recreation Center is a neighborhood fitness center equipped...
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13_Internal_Controls_Part_2 - 1 Internal Controls 2 Lect 13...

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