Theory on Control of Assets

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Part 1: Theory on control of assets 1) Internal controls are methods that a company puts in place to ensure the integrity of financial reports and accounting information, and that they meet operational and profitability targets. They are implemented to assure the safe-guarding of assets as well as to detect fraud and any other errors. As such, they provide the company with reasonable assurance that specific objectives will be achieved. 2) The overall purpose of internal controls is to help a department achieve their goals by establishing protocols, preventing fraud and theft, separating duties, organizing information, reducing errors, protecting assets, making sure people adhere to policies and to ensure accurate accounting records are kept. It is what a department does or uses to see that the things they want to happen will happen…and the things they don’t want to happen won’t happen. Examples: • The person handling the order forms must not be the same person collecting the orders. - Separation of duties - Prevention against theft • Files must be kept containing the order forms and kept in a safe area with limited people allowed access to it. - Organizing information - Prevention against theft - Accurate accounts are kept 3) An internal auditor is there to add value and improve an organization’s operations. He helps the organization achieve their objectives by bringing in and using a systematic, disciplined approach which he can use to evaluate and improve the effectiveness of risk management, control, safe-guarding of assets and governance processes. He would pick up on mistakes and weaknesses within the business and approve on them by designing or fixing them with a new and updated system. He will implement this t... ... middle of paper ... ... http://www.deloitte.com/view/en_CN/cn/services/corgov/ic/iarr/  http://intraweb.stockton.edu/eyos/internal_audit/content/docs/icnote2.pdf  http://internalaudit.nsula.edu/internal-controls/  http://www.decd.sa.gov.au/pmia/files/links/InternalControls.pdf  http://www.businessdictionary.com/definition/risk-analysis.html  http://www.whistleblowing.com.au/information/documents/InternalControls.pdf  http://idahobusinessreview.com/2012/08/09/internal-controls-protect-company-assets/  www.onswipe.investopedia.com  www.smallbusiness.chron.com  http://qcboss.com/blog/?p=350  http://www.lotcobistand.org/pdf/Guidelines_Risk_Assessment_and_Management.pdf  http://www.ask.com/question/why-is-insurance-important  http://www.wikihow.com/Prepare-an-Asset-Register  http://www.sympac.com.au/index.php/our-solutions/managing-customers/debtors-management

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