MGRL-1200 Lecture Notes - Lecture 4: Bank Reconciliation, Internal Control, Bank Statement

• School: Vanderbilt University
• Department: Managerial Studies
• Course: MGRL-1200
• Professor: Trentham Brent

Document Summary

Internal controls procedures and processes with the objective of: safeguarding assets, maximize effectiveness and efficiency of operations, ensuring information is accurate (reliable financial reports, ensuring compliance with laws and regulation. Control environment management philosophy & operating style, organizational structure, & personnel policies. Risk assessment where are the exposures for control weaknesses: strategic risks: external to the company (from competitors, political/economic factors, technology, etc, business process risks: internal process of the company (human resources, marketing, production, etc. Preventive controls limits the possibility of something happening. Control activities internal control policies and procedures that fall into one of two categories: 1: defined authority & responsibility, segregating / separating duties, safeguards over assets and records. Detective controls catches something it after it happens. 2: adequate documentation and records (e. g. pre-numbered checks, reconciliations and counts (e. g. counting inventory, preparing bank reconciliations) Information and communication collecting useful data and getting that information to employees in a timely manner.