Chapter 10 - Internal Controls COSO

Performed to addressmanage risks related to internal

Info iconThis preview shows pages 16–20. Sign up to view the full content.

View Full Document Right Arrow Icon
performed to address/manage risks related to internal control objectives. n Types of control activities: n Segregation of duties n Access vs. Authorization vs. Accounting n Design vs. Operations vs. Data Control n Physical controls – to protect assets and information n Proper authorization of transactions (general vs. specific) n Adequate documents and records n Independent checks on performance n Information processing controls – focus on control
Background image of page 16

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
+ Monitoring n Mechanisms/processes designed to monitor the effectiveness and efficiency (design and operations) of internal control, and report such that corrections can be made. n Types of monitoring: n Ongoing n Management/superior attention n Complaint department n Regular inventory checks n Training/feedback n Periodic n Internal audit function n
Background image of page 17
+ Limitations of Internal Control n Cost/benefit restrictions (small companies, SOX 404) n Insufficient independence to provide assurance to external parties n Poor judgment n Breakdowns n Collusion (can override even segregation of duties) n Management override
Background image of page 18

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
+ Enterprise Risk Management (ERM)
Background image of page 19
+ Use of Control Risk Matrix to Evaluate Controls n Identify audit objectives/assertions n Identify existing controls n Use control activities as a guidance to decide whether controls are adequate n Identify key controls: controls that are expected to have greatest effect on meeting the audit objectives n Associate controls with objectives n Identify and evaluate control deficiencies
Background image of page 20
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

Page16 / 20

performed to addressmanage risks related to internal...

This preview shows document pages 16 - 20. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online