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Internal Controls

Reporting on Internal Control: Public Companies

The profession has argued for decades about the advisability of mandatory reporting on internal control by public companies and by governmental entities. In the 1970s and 1980s, the main players in the debate were the Commission on Auditor's Responsibilities (the Cohen Commission), the AICPA, and the SEC, among others, and their

Limitations of Internal Control System

Scenario: You are an accountant at a local CPA firm that is auditing the accounting records of XYZ Company. You have been asked to educate the accounting department about the limitations of the internal control system in preparation for an upcoming audit. During your audit, you have identified that because of a weak internal con

Primary purpose of an internal control system including three objectives

1. Summarize the primary purpose of an internal control system? 2. What are the three internal control objectives for financial reporting? 3. What are the accounting regulatory bodies, and discuss how the organization complies with the standards of the regulatory bodies that were selected.

Identify strengths and weaknesses of Mt. Hood's internal control

Identify strengths and weaknesses of Mt. Hood's internal control and give suggestions for each weaknesses. 1. Mt. Hood has identified a small group of office furniture dealers whose operations have deteriorated to the point that their ability to repay the company is doubtful. The company has decided to make additional shipmen

Justification for an Internal Control System

Leadership confronts you as a controller and questions the need for an internal control system. Write a report justifying the need for this system when controls are already in place with insurance and portfolio approach. Explain why current approaches are valid but why an internal system will be more beneficial. You need

Internal Control (Brown Company)

Brown Company provides office services for more than 100 small clients including: A. Supplying temporary personnel B. Providing monthly bookkeeping services C. Designing and printing small brochures D. Copying and reproduction services E. Preparing tax reports Some clients pay cash for these services, some have a 30-day ch

Transaction Processing and the Internal Control Process

Required (a) What caused the large increases in postal expense at WDI? How could such large increases have escaped management's scrutiny? (b) Suggest changes in WDI's accounting system to prevent similar situations from occurring in the future. (c) What steps should WDI take to bring postal expenses under management co

Control Mechanism Paper

A. Identify four types of control mechanisms (ways controls are applied) used in Walt Disney. b. Compare and contrast these control mechanisms. use at least 2 references.

The solution to Internal Controls

What is the purpose of internal control? Why is internal control important? How can internal controls help or hinder a company's success? Define, explain, give examples and be specific. What governing bodies are responsible for establishing financial reporting parameters? What is their purpose? Which body is the most importan

BrownSole Shoe: Procedures to document the internal control system

As part of an audit engagement, you have been assigned the task of documenting the internal control system for the BrownSole Shoe Store. The business is operated by a single owner, who operates the store daily with only two additional employees who help out in everything, from stocking new shoes, to helping customers, to bill p

What is the purpose of internal control? Why is it important?

What is the purpose of internal control? Why is internal control important? How can internal controls help or hinder a company's success? Who is responsible for establishing internal controls within the organization? What are some examples of effective internal controls? How can a company determine if the internal controls are e

Principles of internal control

Identify 6 principles of internal control. Give examples for each principle that might be observed when picking up pizza.

Internal Cash Control: Idaho Company

Resources: Ch. 4 of Essentials of Accounting Write a paper that addresses the following questions: o Read scenario E4-5 on p. 194 of your text. Answer questions A & B. o Read scenario P4-1A on p. 197 of your text. Answer the question at the bottom of the scenario piece. o Read scenario P4-2A on p. 197 of your text. A

Auditing and Internal Controls

1. Using risk assessment and control, which of the following risks would be most likely to require the creation of an internal control? Probability of Amount of Occurrence Potential Loss A. Low Low B. Low High C. High Low D. High High Use the following information to prepare a statement of cash flows (direct method) and

Internal Control Principles and Their Application

Marais Company recently changed its system of internal control over cash disbursements. The system includes the following features. 1. Instead of being unnumbered and manually prepared, all checks must now be prenumbered and written by using the new checkwriter purchased by the company. 2. Before a check can be issued, each in

Control activities in payroll processing

As part of the audit of Manor Company, you are assigned to review and test the payroll transactions of the Galena plant. Your tests show that all numerical items were accurate. The proper hourly rates were used, and the wages and deductions were calculated correctly. The payroll register was properly footed, totaled, and post

Societe Generale SA, a major French financial institution, has suffered a 4.9 billion euro loss due to internal control breakdowns that allowed one trader to take on far more risk than was prudent.

The importance of internal controls ... a little side trip due to current events: This is an article that highlights the importance of internal controls in managing financial functions (and by extension to managing all business functions). Can you read this article: