{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}


ACCT-2001-EXAM-2-NOTES - ii Discrepancies reported to...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
ACCT 2001 EXAM 2 NOTES (SEPT. 30) C. Principles of Internal Controls i. Control is most effective when only one person is responsible of a given task ii. Example: Shipping costs go up then go to head of shipping department and see if people are possibly shipping personal goods a. Physical, mechanical, and electronic controls i. Physical- locking safes, warehouses, computers, etc. ii. Mechanical and Electronic- television monitors, time clocks, and alarm systems, etc. b. Independent Internal Verification i. Records periodically verified by an employee who is independent
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: ii. Discrepancies reported to management c. Other Controls i. Bond Employees ii. Rotate employees duties and require vacations (opportunity to check and see if being dishonest) iii. Conduct background checks d. Limitations of Internal Control i. Cost should not exceed benefit (small company doesn’t need what big company does) ii. Human element (Even though segregation of duties helps, people can come together to make theft work, example: mad money) iii. Size of business...
View Full Document

{[ snackBarMessage ]}

Ask a homework question - tutors are online