ACFI1001 Lecture Notes - Lecture 8: Internal Control, Direct Debit, Bank Reconciliation

• School: University of Newcastle
• Department: Accounting
• Course: ACFI1001
• Professor: Marcus

Document Summary

(cid:858)i(cid:374)ter(cid:374)al (cid:272)o(cid:374)trol is a pro(cid:272)ess, effe(cid:272)ted (cid:271)y a(cid:374) e(cid:374)tity(cid:859)s (cid:271)oard of dire(cid:272)tors, (cid:373)a(cid:374)age(cid:373)e(cid:374)t, a(cid:374)d other personnel, designed to provide reasonable assurance regarding the achievement of o(cid:271)je(cid:272)tives relati(cid:374)g to operatio(cid:374)s, reporti(cid:374)g a(cid:374)d (cid:272)o(cid:373)plia(cid:374)(cid:272)e. (cid:859) co(cid:373)(cid:373)ittee of spo(cid:374)sori(cid:374)g. Organisations of the treadway commission (coso), internal control integrated framework, Five integrated components: control environment risk assessment control activities information and communication monitoring activities. Relevant to all areas: segregation of duties, good records maintenance, safeguards and approval authorities. Specifically relevant to accounting: physical audits, standardised documents, trial balances and reconciliations. Preventive controls are policies and procedures designed to prevent errors, inaccuracy or fraud before it occurs. Detective controls are designed to identify problems that already exist. Clear system of responsibility, authority, delegation and separation of duties. Production of suitable documents and records to create an audit trail. Develop an organisation chart and clear job descriptions. Require two signatures on payments above a specified amount. Keep detailed records of assets and limit access to the records.