Justification For An Internal Control System

657 words - 3 pages

Justification for an Internal Control System
Christine Griffin
ACC 544
July 28, 2014
Richard Cornett

Justification for an Internal Control System
As the controller for my company, I monitor all financial activities, conduct audits as needed, create high-level financial reports, and implement accounting methodologies to make the company run efficiently (PayScale, n.d.). The leadership of the company has asked me why there is a need for an internal control system when controls are in place with insurance and portfolio approaches.
Insurance Approach
A company will purchase insurance to protect their assets. The owner of a company will purchase liability insurance to protect his ...view middle of the document...

The portfolio may contain investments with systematic and unsystematic risk. Systematic risk can never be eliminated. Systematic risks are associated with interest rates, recession, war, and political instability. Unsystematic risk (specific risk) relates to the shares of a specific company in the portfolio. Unsystematic risk can be controlled and minimized. The more investments a company has will reduce the risk by spreading it across the portfolio (diversification) (Spowart, 2014).
Need for an Internal Control System
An internal control system is needed to provide accountability and encourage sound management practices. A well designed system will help reduce the chance of material misstatements. Policies and procedures are added to these systems to make sure they are working properly. These safeguards are a company’s internal control system (Hoyle & Skender, 2014). An internal control system assures the effectiveness and efficiency of operations, reliability of financial reporting, and compliance with applicable laws and regulations.
I have explained about insurance and portfolio approaches and the need for an internal control system. The current...

Other Papers Like Justification for an Internal Control System

Evaluation of System of Internal Control-Lbj Company

1037 words - 5 pages related activities, particularly those involving authorization, custody, or recordkeeping. For example, the same person who is responsible for an asset's recordkeeping should not be responsible for physical control of that asset. Having different individuals perform these functions creates a system of checks and balances. • Proper authorization of transactions and activities helps ensure that all company activities adhere to established

Recommendation for Internal Control Auditor Essay

708 words - 3 pages recommendations to improve the system, check the assets of the company and how they are safeguarded, and advise the company if their resources are being used adequately (Advameg, Inc., 2011). Internal accountants can perform different types of audits for the company such as an operational, program, fraud, ethical business practices, compliance, financial, control self assessment audits as well as a systems development and life cycle review

Building An Access Control System

996 words - 4 pages attacker has gained access, the goal of the attack fails is they are unable to maintain control. Covering tracks once an attacker has violated a system will destroy all evidence of his or her attacks. You could eliminate Trojans, viruses, and worms to your devices before catastrophic damage to your computer systems make it impossible to fix. Theses malicious bugs use different entry points as mentioned earlier. Trojans are able to enter through

Recommendation Brief for an Internal Accountant

674 words - 3 pages Recommendation Brief for an Internal Accountant 1 Recommendation Brief for an Internal Accountant Kelsy Fee ACC/544 April 13, 2015 Professor La Ron Roach Recommendation Brief for an Internal Accountant 2 In this recommendation brief the benefits of hiring an internal accountant will be discussed. Having an internal accountant would help fix an out-of-control system and the justification of taking

Reccomendation Brief for an Internal Audit

644 words - 3 pages Recommendation Brief for an Internal Auditor Jennifer Perkins December 9, 2013 ACC 544 Tracie Youngblood An internal auditor certifies a company’s financial statements are timely, relevant, and reliable. According to the American Accounting Association (1973), “Auditing is a systematic process of objectivity obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of

"Internal Factors Within the Educational System Are the Primary Reason for the Improvement in Girls' Achievement" Discuss

1384 words - 6 pages "Internal factors within the educational system are the primary reason for the improvement in girls' achievement" Discuss. Girls achievements have improved over the years due to the external and internal factors of gender differences within achievement. Statistics show that since 1985 boys' and girls' achievements in school have both improved drastically in the percentage of pupils achieving 5 or more A*'s to C at GCSE level. However

It Integration System: an Introduction to Erp for Ebusiness & Ecommerce Activity

3129 words - 13 pages , 2000). In order for SMARTZ move into this ‘e’ activity, there are several matters that need to be highlight. As SMARTZ have multiple outlets across border, an integrated system should be implement where all the back-end activities (B2B, SCM) can be centralized in one system and in the mean time, the front-end activities (B2C, CRM) is continuously supported 24 hours (Turban, King, & Lang, 2009). 2.1 Enterprise Resource Planning (ERP) An

What Value Does An Automated Asset Inventory System Have For The Risk Identification

474 words - 2 pages Security Agency (NSA) is responsible for the security of all national critical infrastructure. 19. True or False: ___False___ The National Security Agency (NSA) is the federal agency responsible for signal intelligence and information system security of classified systems. 20. Identity theft is when personal information such as name, social security number, banking information or information that is associated with one person is used by another who is impersonating that person in order to obtain an ill gotten benefit or financial gain.

Wk 2 Paper

732 words - 3 pages Justification for an Internal Control System Juanita R. Martin ACC/544 December 3, 2012 Robert J. Cornett Justification for an Internal Control System The internal control system plays an important part in a company’s management function. Internal controls keep a company from loss of assets while maintaining objectives, which helps keep the company on track with its mission. The controller’s role is to be a supportive mechanism in helping

Conceptual Basics of Internal Audit

3891 words - 16 pages INTRODUCTION Internal Audit or internal control system refers to systems or control of financial and the like devised by management in order to carry on the business of there enterprise in orderly and efficient manner. It can also be defined as an adherence to management policies and the safe guard of assets and secure as far as possible the completeness and accuracy of the organization records. It is the responsibility of management to decide


2499 words - 10 pages a monitoring role and are responsible for ensuring that the necessary controls over the activities of their companies are in place – and working. Furthermore for the Internal Audit is it stated that “We regard it as good practice for companies to establish internal audit functions to undertake regular monitoring of key controls and procedures. Such regular monitoring is an integral part of a company’s system of internal control and helps to

Related Essays

Justification For An Internal Control System

936 words - 4 pages complete the internal control system. Having a complete internal control system can further protect the company from risks. The controller is or can be an employee who’s job title is mainly to be the backbone for management when dealing with accounting and financial records that deal with the controls of organizations and organizational goals. If the main focus of the controller is financial controls and the financial process, along with the

Internal Control System Justification Essay

672 words - 3 pages Internal Control System Justification Brandy Ritz ACC/445 May 5, 2014 Bunney Schmidt Internal Control System Justification Internal controls are a good way to keep records up to date and valid. Insurance and portfolio approaches are great to have set in place for risk management, but a system of controls would provide extra security with the books. Below is an overview of insurance and portfolio approaches along with why internal

Justification For Internal Control Essay

549 words - 3 pages Justification for an Internal Control System ACC/544 The Controller is responsible for analyzing a company's performance in compliance and reporting, operations and assist management in developing its goals and budgets. They are also responsible for analyzing and managing risks companies may encounter. Performing these tasks require the controllers and financial officers to establish internal controls. The internal control system

Internal Control System Essay

5108 words - 21 pages INTRODUCTION Internal control, the strength of every organization, has become of paramount importance today in Nigerian banks. The reason being that the control systems in any organization is a pillar for an efficient accounting system. The need for the internal control systems in the organizations, especially banks, cannot be undermined, due to the fact that the banking sector, which has a crucial role to play in the economic development