Internal controls are highly integral to the success of any business and it is important to establish a clear understanding of their importance. This training is for professionals who must know how to manage and strengthen controls.
If internal controls will be effective, they must be designed to provide reasonable assurance regarding what this course teaches, including:
• achievement of operational objectives
• effectiveness and efficiency of operations
• accurate timely, reliable and meaningful financial and other information
• compliance with applicable laws and regulations
• safeguarding of corporate assets
• overall strategy and business performance.
• Standard Operating Procedures
- documented and up-to-date SOPs
- effectiveness of SOPs.
- consistency of policies and procedures with corporate and legal statutes
- compliance with laws, regulations and standards.
- up-to-date Procedures Manual
- policy guidelines on purchasing - ordering, accepting, approving,
processing and recording.
- equipment items regular maintenance
- equipment items test schedule
- information systems periodic evaluation.
• Computer Systems
- systems security.
- Adequacy of physical security
- security personnel.
• Customer Focus
- management of customer complaints.
- spending plans
- sufficiency of funds to cover major expenditures
- budget revisions approvals and recording.
• Accounting Records
- Financial Statements prepared in conformity with the applicable IFRS
- cash receipt and expenditure records and controls effectiveness
- cheques receipt and issuance records and controls effectiveness
- pre-numbered receipts issued
- expenditure and revenue transactions coding consistent with budget
- alterations - cheques, receipts, documents.
• Cash Management
- Cash Management Plan
- effectiveness of petty cash management
- advances and settlements
- bonding of employee who handle cash
- handling of cash that can’t be deposited in the bank
- cash collections balanced to receipts daily
- investigation of cash overages and shortages
- accountability for cash and related items (Cheques, Credit Cards,-
- policy for electronic payments
- cash periodically counted and verified.
- funds used only for the budgeted purchases
- procedure to follow up on major unrealized revenue items
- prompt action to address budget variances.
- written credit and collection policies
- over expenditures or under realized revenues discussed.
- expenditure limits
- signatories mandates
- signatory limits.
- Fixed Assets Register
- Reconciliation of the Fixed Asset System with the control accounts
- all fixed assets properly valued
- safeguard procedures for valuable and sensitive assets against theft
- equipment subject to regular maintenance schedule
- insurance coverage reviewed periodically
- physical inventory taken at least annually.
- proper accounting of following aspects: Receipt of Materials; Issue/
Consumption of Materials; Transfer of Materials; Stock of Materials
- adequate physical security surrounding inventories
- enough insurance for significant inventories
- employees responsible for inventories adequately bonded.
- Rules and Regulations governing the Company Permit for investments
- policies and procedures established for acquisition and disposal of
- resources identified, available and assigned to projects
- responsibilities clearly defined
- periodic reports of performance prepared and reviewed
- resources for performance and statutory compliance
- alignment of authority and responsibility
- efficiency measurements compared with industry standards
- optimality utilization of resource for priority
- maintenance of skills and abilities that are essential.
- unannounced audits
- timely and adequacy of audit, reviews and adjustments
- effectiveness of audit, reviews and adjustments.
• Human Resources
- payroll and employee records safeguarded in compliance with Labour
- employee information promptly transmitted to HR Department and the
Internal Auditor’s Office
- Does the description of job responsibilities for the position match the
responsibilities stipulated for the classification
- surveys made periodically to benchmark compensation.