Volume 13: Chapter 9: Internal Controls
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Business Combinations and Consolidated Financial Reporting
Business Combinations and Consolidated Financial Reporting Business Combinations and Consolidated Financial Reporting Copyright 2014 by DELTACPE LLC All rights reserved. No part of this course may be reproduced in any form or by any means, without permission in writing from the publisher. The author is not engaged by this text or any accompanying lecture or electronic media in the rendering of legal, tax, accounting, or similar professional services. While the legal, tax, and accounting issues discussed in this material have been reviewed with sources believed to be reliable, concepts discussed can be affected by changes in the law or in the interpretation of such laws since this text was printed. For that reason, the accuracy and completeness of this information and the author's opinions based thereon cannot be guaranteed. In addition, state or local tax laws and procedural rules may have a material impact on the general discussion. As a result, the strategies suggested may not be suitable for every individual. Before taking any action, all references and citations should be checked and updated accordingly. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert advice is required, the services of a competent professional person should be sought. —-From a Declaration of Principles jointly adopted by a committee of the American Bar Association and a Committee of Publishers and Associations. All numerical values in this course are examples subject to change. -
Metropolitan Council Internal Audit Charter A
METROPOLITAN COUNCIL INTERNAL AUDIT CHARTER A. AUDIT COMMITTEE PURPOSE: The Metropolitan Council has established a special committee of the Council to be called the Metropolitan Council Audit Committee. The purpose of the Committee is to assist the Metropolitan Council in fulfilling its oversight responsibility for the integrity of the Council’s financial and operational results, compliance with legal and regulatory requirements, and the performance of internal audit and external auditors. AUTHORITY: The Audit Committee has authority to conduct or authorize special audits and investigations into any matters within its scope of responsibility. It is empowered to: Approve the Chief Audit Executive’s Audit Plan. Resolve any disagreements between management and the internal/external auditors regarding financial or operational control and reporting. Review and accept external auditors’ reports along with management’s written responses when appropriate. Obtain information from employees or external parties as part of its review. Council employees are directed to cooperate with Audit Committee requests. Meet with Council employees, external auditors, legal counsel, or others as necessary. Be consulted regarding changes in the Chief Audit Executive’s duties. Be informed of all matters that impair the conduct of an audit or review. However, where feasible such matters shall be first brought to the attention of the Regional Administrator for resolution before communicating them to the Audit Committee. Make periodic reports to the Council or appropriate standing committee established by the Council. RESPONSIBILITIES: Financial and Operational Review Oversight Review significant accounting, operational and reporting issues and understand their impact on the financial and operating results on the Metropolitan Council’s system of internal control. -
Close, Consolidate and Report
Close, Consolidate and Report Point of view on Enabling Technologies December 2016 © 2016 Deloitte The Netherlands 1 Introduction Finance Organization of the future Wheel of Finance The future of Finance: As we look at What does the future hold for the the future of Finance, it’s important to Finance function? Today’s Finance consider two things: How Finance organizations are more then ever under delivers value to the organization, and pressure to deliver value to the business what enables the Finance function to do and in parallel operate within a highly so. cost-efficient and most-effective delivery model. The introduction of new Digital How Finance delivers value: In our technologies is likely to be the view, Finance delivers value through most important factor impacting the three types of services: Operational Finance function. Finance, Business Finance and Specialized Finance. Think transactional, Digital technologies radically transform strategic and highly specialized. how the business and it’s Finance function delivers value. Digital Finance What enables Finance: Underpinning utilizes disruptive technology, data, these three services are what we call innovation, and people to elevate and Finance enablers. These enablers differentiate the capabilities of the include the organizational structure and Finance function. Digital requires the Finance team’s talent; the organizations to think and act differently information, systems and data available in order to generate value. to the Finance group, and the processes and policies that enable the Finance The ability of CFOs to leverage Digital team to monitor risk and stay on top of technologies to position their future regulatory obligations. Finance function will determine the future of their organizations. -
Internal Control and the Board: What Is All the Fuss About?
The Deloitte Academy June 2021 Stakeholders Societal licence Shareholders Responsible business Transparency Corporate governance Viability Company purposeAudit committee Culture Strategy Viability Internal control KPIs Audit quality Remuneration Sustainability Trust Shareholders Strategy Assurance KPIs Reputation Capability Stakeholders Company purpose Viability Internal control and the board: What is all the fuss about? Headlines • The UK Corporate Governance Code already establishes a clear responsibility on the whole board to establish a framework of prudent and effective controls – however, behind the UK proposals for a US style internal control attestation are very real questions as to whether responsibilities go far enough and whether there is sufficient guidance for boards, together with sufficiently detailed information from management, to meet these responsibilities effectively. • In particular the guidance does not address the pervasiveness of technology in detail, and boards may not be obtaining sufficient assurance over the effectiveness of IT controls given the complexity and interdependency of the IT infrastructure which exists in many companies today. • The extent of work performed by external auditors is also not well understood - careful questioning of auditors in relation to their audit scope and approach could reveal much about the control environment. • In summary, boards should not wait for further announcements from the Government or FRC/ARGA before taking action in this area, particularly if they are not able to answer the questions which we raise throughout this publication. Internal control and the board: What is all the fuss about? A reminder of the current UK Corporate Governance Code requirements • Overarching board responsibility from Code Principle C: The board should establish a framework of prudent and effective controls, which enable risk to be assessed and managed. -
AHA 2018 Accounting Policy
Albuquerque Housing Authority Accounting Policy 2018 Revised Edition 1840 University Boulevard SE Albuquerque, NM 87106 Phone: (505) 764-3920 Fax: (505) 764-3981 www.abqha.org Albuquerque Housing Authority Accounting Policy Contents Introduction ......................................................................................................................................................................... 3 Housing Authority & Compliance ................................................................................................................................... 3 Department of Housing & Urban Development (HUD) ....................................................................................... 3 HUD Financial Assessment.......................................................................................................................................... 4 Financial Compliance .................................................................................................................................................... 4 Compliance with External Policies .............................................................................................................................. 5 Board Authority .................................................................................................................................................................. 5 Board of Housing Commissioners ............................................................................................................................. -
Internal Control Guidance (Pdf)
Kansas State University Internal Control Guidance Purpose The internal control guidelines seek to: • Provide practical tools for those charged with responsibility to process transactions. • Maintain custody of resources. • Communicate established policies and procedures. • Convey the definition of internal control. Key Guidelines Benefits of Effective Internal Control Purpose 1 One of the most misunderstood roles of internal control is the belief that it exists solely to prevent or reduce fraud. In reality, Benefits of Effective Internal Control 1 the purpose of internal control is much more broad. Benefits include: Consequences of a Lack of Internal Control 1-2 • Reliable reporting to support management decisions. • Consistent, efficient methods to process transactions. Concepts of Internal Control 2 • Compliance with university, state and federal regulations. Risk Assessment 2 Effective controls also can reduce instances of noncompliance and negative publicity with grant rules and legislative Information Technology (IT) Controls 3 dictates. These controls ensure continued good relations with students, legislators, the Kansas Board of Regents, grantors, Information and Communication 3 donors and Kansas taxpayers. Effective internal control does more than simply satisfy auditors or central administration. It allows for effective, efficient operations by providing reliable information and compliance with regulations that protect Reporting Fraud and Misconduct 4 future funding. Monitoring 4-5 Control Activities 4 Consequences of a Lack of Internal Control To illustrate the need for controls in a variety of risk areas, we have included the following excerpts from the Auburn Physical Controls 5 University Office of Audit, Compliance and Privacy newsletter. The names of individuals, states and institutions have been Transaction Authorization 5 omitted, and none are from the state of Kansas. -
Business Combinations and Changes in Ownership Interests
25263 bd IFRS3 IAS27:25263 IFRS3/IAS27 bd 4/7/08 10:02 Page a Business combinations and changes in ownership interests A guide to the revised IFRS 3 and IAS 27 Audit.Tax.Consulting.Financial Advisory. 25263 bd IFRS3 IAS27:25263 IFRS3/IAS27 bd 4/7/08 10:02 Page b Contacts Global IFRS leadership team IFRS global office Global IFRS leader Ken Wild [email protected] IFRS centres of excellence Americas Robert Uhl [email protected] Asia Pacific Hong Kong Melbourne Stephen Taylor Bruce Porter [email protected] [email protected] Europe-Africa Copenhagen Johannesburg London Paris Jan Peter Larsen Graeme Berry Veronica Poole Laurence Rivat [email protected] [email protected] [email protected] [email protected] Deloitte’s www.iasplus.com website provides comprehensive information about international financial reporting in general and IASB activities in particular. Unique features include: • daily news about financial reporting globally. • summaries of all Standards, Interpretations and proposals. • many IFRS-related publications available for download. • model IFRS financial statements and checklists. • an electronic library of several hundred IFRS resources. • all Deloitte Touche Tohmatsu comment letters to the IASB. • links to several hundred international accounting websites. • e-learning modules for each IAS and IFRS – at no charge. • complete history of adoption of IFRSs in Europe and information about adoptions of IFRSs elsewhere around the world. • updates on developments in national accounting standards. 25263 bd IFRS3 IAS27:25263 IFRS3/IAS27 bd 4/7/08 10:02 Page c Contents 1. Introduction 1 1.1 Summary of major changes 1 1.2 Convergence of IFRSs and US GAAP 3 2. -
Internal Controls and the Internal Auditor Presented By: Richard Kudlik, CPA Interrelated Components
Internal Controls and the Internal Auditor Presented By: Richard Kudlik, CPA Interrelated Components Control Environment Risk Assessment Control Activities Information and Communication Monitoring What is an Internal Control? Internal control is broadly defined as a process, …….. effected by an entity's board of directors, management and other personnel,……… designed to provide reasonable assurance…….. regarding the achievement of objectives in the following categories: Protect District assets. Effectiveness and efficiency of operations. Reliability of financial reporting. Compliance with applicable laws and regulations. Limitations of Internal Control 1. Management Override Management may override the structure to commit fraud or misstate the financial statements. 2. Human Errors Human errors may arise from misunderstanding of instructions, mistakes of judgment, and personal carelessness, distractions, or fatigue. 3. Collusion Collusion may circumvent the separation of duties. 4. Changing Conditions Conditions may change, weakening a system that was adequate at a point in time. 5. Combination of duties One employee is performing conflicting job duties (lack of segregation of duties). Control Characteristics When identifying controls within processes – consider the characteristics of those controls Preventative Controls that minimize the possibility of an error or deliberate misstatement Examples: building access cards, segregation of duties, no price change without supervisor’s access code Detective Controls that -
Accrual and Deferral Handout
Name Principles of Financial Accounting I Adjusting the Accounts "Cash" Basis vs. "Accrual" Basis: Cash Accrual Revenue Expenses Generally Accepted Accounting Principles (GAAP) require using the basis. Why make Adjusting Journal Entries?____________________________________________________ _________________________________________________________________________________ Recall previous "promises." New Promise: Every adjusting entry will have ______________________ Balance Sheet and one_________________________________________________________ effect. INCOME STATEMENT attempts to accomplish: ____________________________________________ ESSENTIALS OF CONCEPT 1. 2. 3. I. Identifying accounts to be adjusted: Accruals and Deferrals A. Perhaps the best way to distinguish deferrals and accruals is the timing of cash changing hands: CA$H accruals deferrals cash AFTER event cash BEFORE event Deferrals have been recorded; accruals have not. B. Definitions An ACCRUAL is an expense or a revenue . Examples of accruals: Expense: Revenue: Copyright © 1999 by M. Ray Gregg. All Rights reserved. A DEFERRAL is a already paid or of a revenue . Examples of deferrals: Expense: Revenue: II. Accruals A. Expenses 1. Example Salaries increase as employees work each day, yet, for convenience, salaries are recorded when . Since the cash is paid the event, salaries are an example of . The adjusting entry necessary when payday and the end of the fiscal period are on different days would be: 2. Decision tree conclusion If this is the entry required for this , other accrued expense items must follow a similar format: B. Revenue 1. Example Your CPA firm is auditing a client's records; the engagement begins in mid-November and lasts through the end of February. Each day as work is being performed, revenue is earned. Since the cash will not be collected until completion of the engagement (after the event), this is an example of . -
Risk Management and Internal Controls
Risk Management and Internal Controls Accounting & Audit Update April 26, 2018 Learning Objectives . Develop an understanding of risks your organization may be facing . Understand the value of enterprise risk management . Know how internal controls can help in addressing risks . Recognize your role in risk management 2 1 Agenda . Overview of Risk Management . The State of Risk Oversight – AICPA & North Carolina Poole College of Management ERM Initiative Study 2017 . COSO ERM Framework . What can I do? 3 Risk Management and IC OVERVIEW 4 2 Introduction . Every choice we make in the pursuit of objectives has its risks. From day- to-day operational decisions to the fundamental trade-offs in the boardroom, dealing with uncertainty in these choices is a part of our operational lives. 5 Risk vs. Uncertainty . Risk – the possibility that event(s) will occur and affect the achievement of strategy and business objectives . Uncertainty – the state of not knowing how or if potential events may manifest 6 3 Variety of Risks & Assessments . Governance . Compliance . Financial . Environmental risk . Operational . Fraud risk . Technology . IT/information . Legal security risk . Reputation . Insurance . Strategic . Investments . HR 7 Governance Risk . Lack of succession planning . Board make-up and structure . Poor advisors . Dysfunctional working relationships between executives and board . Ethical issues . Non-prudent behavior . Changing values 8 4 Financial Risks . Access to/availability of capital . Investment risks . Errors or fraud and financial reporting . Lack of oversight or approvals . Misappropriation of assets . Loss of revenue sources . Loss of key suppliers 9 Operational Risks . Decrease in service quality . Safety . Inadequate internal controls . Lack of accountability by business partners . -
Publication 538, Accounting Periods and Methods
Userid: CPM Schema: tipx Leadpct: 100% Pt. size: 10 Draft Ok to Print AH XSL/XML Fileid: … ons/P538/201901/A/XML/Cycle04/source (Init. & Date) _______ Page 1 of 21 15:46 - 28-Feb-2019 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. Department of the Treasury Contents Internal Revenue Service Future Developments ....................... 1 Publication 538 Introduction .............................. 1 (Rev. January 2019) Photographs of Missing Children .............. 2 Cat. No. 15068G Accounting Periods ........................ 2 Calendar Year .......................... 2 Fiscal Year ............................. 3 Accounting Short Tax Year .......................... 3 Improper Tax Year ....................... 4 Periods and Change in Tax Year ...................... 4 Individuals ............................. 4 Partnerships, S Corporations, and Personal Methods Service Corporations (PSCs) .............. 5 Corporations (Other Than S Corporations and PSCs) .............................. 7 Accounting Methods ....................... 8 Cash Method ........................... 8 Accrual Method ........................ 10 Inventories ............................ 13 Change in Accounting Method .............. 18 How To Get Tax Help ...................... 19 Future Developments For the latest information about developments related to Pub. 538, such as legislation enacted after it was published, go to IRS.gov/Pub538. What’s New Small business taxpayers. Effective for tax years beginning -
Internal Control Liability Concerns Post Sarbanes-Oxley: Perspectives on Legal Liability and Reasonableness
Journal of Forensic & Investigative Accounting Vol. 2, Issue 2 Internal Control Liability Concerns Post Sarbanes-Oxley: Perspectives on Legal Liability and Reasonableness Richard Mark Roberta Ann Barra Martin E. Taylor* 1. The Role of the Accounting Profession in Internal Control With passage of the Securities Act of 1933 (the 33 Act) and the Securities Exchange Act of 1934 (the 34 Act), Congress directed the SEC “to protect the public from false and misleading information by requiring publicly-owned corporations to disclose financial and other information in a manner which accurately depicts the results of corporate activities. Congress gave the SEC broad authority to establish accounting and reporting standards as part of its mandate to administer and enforce the provisions of the Federal securities laws.”1 The Securities Acts also created a need for accountants to act as independent auditors by requiring that certain information reported to the public by corporations be independently certified.2 Under the 33 and 34 Acts, the SEC had the authority over the establishment of accounting and auditing standards. The SEC decided not to exercise that authority, but instead to rely upon accounting and auditing * Richard Mark and Martin E. Taylor are, respectively, Associate Professor and Professor, both at the University of Texas at Arlington. Roberta Ann Barra is an Assistant Professor at the University of Hawai’i at Hilo. 229 standards established by the private sector as long as these standards had “substantial authoritative support”.3 Over the years, three bodies provided authoritative support for accounting standards: The Committee on Accounting Procedure (CAP), the Accounting Principles Board (APB) and, currently, the Financial Accounting Standards Board (FASB).