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Nature of work (Control Environment (Human Resource management (Rotation…
Nature of work
Control Environment
Philosophy & style of senior management
Organising
Directing
Planning
Controlling
Organisation structure
Consider form & nature of organisation
Suitable for type of Organisation
Grouping of activities
Human Resource management
Rotation of duties
Caereer path possibilities
Personnel scheduling
Maintain high morale
Appointment & evaluation Staff
Methods used for communication
Considerations
Organisation Code of conduct
Internal memos,formal memos & manuals
Organisation chart & job descriptions
Clear boundaries of authority
Classification of controls
detective
corrective
preventative
Types of internal controls
adequate documents & records
safeguarding of assets
authorization of transactions & activities
independent checks
segregation of duties
organisation
mission
strategic objectives
vision
NATURE OF WORK
Risk
Control
Governance
Control in IT environment
general controls
IT environment as a whole
pervasive effect
internal control do not change
application controls
specific software programs and systems
input-, processing & output controls
INTERNAL CONTROLS
IIA definition
enhance the likelihood that established objectives
Control, control environment & Control process
action taken by management
SAICA definition
methods & procedures
accepted by management
help in achievement of management's goal
business properly conducted in orderly & efficient manner
COSO definition
provide reasonable assurance
iro objectives to be achieved
process designed
Objectives of internal control
Operational
Compliance
Reporting
Responsibility of internal control
External Auditor
financial accounting system
Internal Auditor
comprehensive
assurance & recommendations
Management
implement IC
COSO Framework
Consist of 5 elements
control environment
risk assessment
control activities
information & communication
monitoring
Stand for Committee Of Sponsoring Organisation
ADVANTAGES & DISADVANTAGES
Advantages
compliance with laws & regulations
builds reputation
promotion of reliable financial reporting
prevention of resource losses
achievement of goals
Disadvantages
cannot ensure success of organisation
cannot ensure reliability of financial information
cannot ensure reasonable assurance
inherent limitations of internal control system