Scribd
Upload
46 views17 pages

DANTIC, Romulo Jr. B.-Presentation

This document discusses internal control, including its nature, purpose, and key elements. [1] Internal control is a process designed by management to provide reasonable assurance of achieving reliable financial reporting, effective and efficient operations, and compliance with laws and regulations. [2] The three main objectives of internal control are reliability of financial statements, effectiveness and efficiency of operations, and compliance with applicable laws and regulations. [3] The five major elements of internal control according to COSO are control environment, risk assessment, information and communication, control activities, and monitoring.

Uploaded by

Lois Jaeda Dantic
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
46 views17 pages

DANTIC, Romulo Jr. B.-Presentation

This document discusses internal control, including its nature, purpose, and key elements. [1] Internal control is a process designed by management to provide reasonable assurance of achieving reliable financial reporting, effective and efficient operations, and compliance with laws and regulations. [2] The three main objectives of internal control are reliability of financial statements, effectiveness and efficiency of operations, and compliance with applicable laws and regulations. [3] The five major elements of internal control according to COSO are control environment, risk assessment, information and communication, control activities, and monitoring.

Uploaded by

Lois Jaeda Dantic
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 17

CHAPTER 13

INTERNAL
CONTROL
Romulo B. Dantic Jr.
CBEA-01-201E
Expected Learning
Outcomes
1. Explain What internal Control is

2. Nature and purpose of Internal Control.

3. Define Internal Control system.

4. Explain the elements of Internal Control


Such us:

- Control Environment
- Risk Assessment
- Information system
- Control actions
- Monitoring of controls
NATURE AND PURPOSE OF
INTERNAL CONTROL
WHAT IS INTERNAL
CONTROL?

Is a process designed and effected by those


charged with governance, management, and
other personnel to provide reasonable
assurance about the achievement of the
entity's objectives with regard to the
reliability of financial reporting, effectiveness
and efficiency of operations, and compliance
with applicable laws and regulations
3 common or Primary
objectives of IC
1
RELIABILITY OF THE ENTITY'S
FINANCIAL STATEMENTS.

EFFECTIVENESS AND EFFICIENCY OF


OPERATIONS

3
COMPLIANCE WITH APPLICABLE
LAWS AND REGULATIONS
Internal Control
Systems
Is a structure of policies
and procedures that
businesses build for
assurance. Every internal
control is a set of
procedures or guidelines
for a particular operation.
ELEMENTS OF
INTERNAL CONTROL
Internal control structures vary
depending on the size, nature,
geographical dispersion, and
objectives of the organization,
but certain elements must be
present to have a satisfactory
system of control.
ELEMENTS OF
COSO

INTERNAL CONTROL
Control Environment
Risk Assessment
Information System
Control Activities
Monitoring of Controls
CONTROL
ENVIRONMENT

The control environment is


the attitude, awareness,
and actions of directors
and management regarding
the internal control
system and its importance
FACTORS COMPRISE THE
CONTROL ENVIRONMENT
Communication and
enforcement of integrity Organizational structure
Commitment to competence
Participation by those
Human esources policies
charged with Governance
and procedures
Management's Philosophy
and operating style

Assignment of authority
and responsibility
COMMUNICATION
AND ENFORCEMENT
OF INTEGRITY
Integrity and ethical values
are essential elements of
the internal control
environment, affecting the
design, administration, and
monitoring of other
components.
COMMITMENT TO
COMPETENCE

This means that


management considers
the skills and knowledge
required of each
employee and hires them
competent to perform
the tasks.
PARTICIPATION BY
THOSE CHARGED WITH
GOVERNANCE
The responsibilities of those
charged with governance include
independence from management,
their experience and stature, their
involvement and scrutiny of
activities, the appropriateness of
their actions, and their interaction
with internal and external auditors.
MANAGEMENT'S PHILOSOPHY AND
OPERATING STYLE
This refers to management's attitude towards
established goals which all have an impact on the
reliability of the financial statements

(B) FINANCIAL (C) MEETING BUDGET OTHER


(A) BUSINESS RISK, ESTABLISHED
REPORTING, AND PROFIT
GOALS
ORGANIZATIONAL
STRUCTURE
Organizational structure provides a
framework for planning, directing,
and controlling operations to
ensure transactions are processed,
recorded, summarized, and
reported in an accurate and timely
manner.
ASSIGNMENT OF AUTHORITY
AND RESPONSIBILITY

Management should develop


job descriptions, computer
system documentation, and
policies to ensure personnel
understand their
responsibilities and the
rules and regulations that
govern their actions.
HUMAN RESOURCES POLICIES
AND PROCEDURES
The most important element of an
internal accounting control system
is the people who perform and
execute the policies and procedures.
Clients should adopt personnel
policies to ensure competent and
honest personnel are hired and
retained, and policies with respect
to employee selection, training, and
supervision should be implemented.
END OF DISCUSSION

THANKYOU!

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy