CHPATER 3
Internal Control Examples
Physical security
Lockbox systems
Internal audits
Insurance and bonding
Firewalls
Edit checks
Document matching
Data encryption
Bank reconciliation
Backup of power supplies
Backup of Computer Files
Background Checks
Adequate Documentation
Internal Controls
by Damir Dzubic
COSO'S Internal Control
Integrated Framework
Control Environment
Top management tone
Control Activities
Actuall internal controls on the basis of the risk assesment.
Information and Communication
For the system to work the communication must be throughout the organization
Monitoring
Quality of internal control performance and assurance it is running effectively.
Risk Assessment
Involves using taxonomy, business experience, research
and dialogue to identify the risk associated with operations.
Risk
Hazard Risk
Directors' and officers' liability
Directors' and Officers' liability
Strategic
Business Strategy Risk
Poor management decision makiing risk
Legal and Regulatory Risk
Risk of breaking the law
Operational
Human Error Risk
People make mistates
Systems Risk
Referes to IT and computer related risks
Financial
Liquidity
Possibility of not have cash for demand
Credit
Inability or not willing to pay amounts owed
Market Risk
Changes in stock prices, investment value, and interest rate
Internal Controls
Encourage Comliance with mgmt's directives
Promote Ops Efficiency
Ensure Fin Statement Reliability
Safegurard Assets
