8slides - Chapter 8 Chapter 8 Internal Control and Cash...

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Chapter 8-1 Chapter Chapter 8 8 Chapter Chapter 8 8 Internal Control and Cash Financial Accounting, Sixth Edition
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Chapter 8-2 Methods and measures adopted to: 1. Safeguard assets.  2. Enhance accuracy and reliability of accounting records.   Reduce risk of: a. Errors  (unintentional)  b. Irregularities  (intentional) Internal Control Internal Control Internal Control Internal Control SO 1 Define internal control. SO 1 Define internal control. Unde r the  S a rb a ne s -O xle y Ac t, a ll pub lic ly tra de d U.S . c o rpo ra tio ns  a re   required to  m a inta in a n a de q ua te  s ys te m  o f inte rna l c o ntro l.
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Chapter 8-3 Companies  must  develop principles of control over financial reporting.   continually verify that controls are working.  Internal Control Internal Control Internal Control Internal Control SO 1 Define internal control. SO 1 Define internal control. The Sarbanes-Oxley Act The Sarbanes-Oxley Act Independent auditors  must attest to the level of internal control.  SOX  created the  Public Company Accounting Oversight Board (PCAOB) .
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Chapter 8-4 Measures vary with size and nature of the  business. management’s control  philosophy. Internal Control Internal Control Internal Control Internal Control SO 2 Identify the principles of internal control. SO 2 Identify the principles of internal control. Principles of Internal Control Principles of Internal Control Illustration 8-1
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Chapter 8-5 ESTABLISHMENT OF RESPONSIBILITY Control is most effective when only one person is responsible for a given  task. Internal Control Internal Control Internal Control Internal Control SO 2 Identify the principles of internal control. SO 2 Identify the principles of internal control. Principles of Internal Control Principles of Internal Control SEGREGATION OF DUTIES Related duties should be assigned to different individuals.   DOCUMENTATION PROCEDURES Companies should use prenumbered documents and all documents should be  accounted for.
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Chapter 8-6 Internal Control Internal Control Internal Control Internal Control SO 2 Identify the principles of internal control. SO 2 Identify the principles of internal control. Principles of Internal Control Principles of Internal Control PHYSICAL, MECHANICAL, AND ELECTRONIC CONTROLS Physical Mechanical  and Electronic Illustration 8-3
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Chapter 8-7 Internal Control Internal Control Internal Control Internal Control SO 2 Identify the principles of internal control. SO 2 Identify the principles of internal control. Principles of Internal Control Principles of Internal Control INDEPENDENT INTERNAL VERIFICATION 1. Records periodically verified by an employee who is independent. 2.
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This note was uploaded on 01/16/2012 for the course CMST 1061 taught by Professor Hebert during the Fall '08 term at LSU.

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8slides - Chapter 8 Chapter 8 Internal Control and Cash...

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