Executive theater di business topics, one of which was Internal Control. Executi
ID: 2449414 • Letter: E
Question
Executive theater di business topics, one of which was Internal Control. Executive Director schedules a meeting with you and other staff to discuss how COMMUNITY THEATER could/should improve internal control. You recall that your Accounting Professor was a big fan of internal control and you pull out your class notes to prepare for that meeting Director of COMMUNITY THEATER just returned from a national conference with other rectors around the country. At the conference he attended a variety of seminars on currentExplanation / Answer
The implementation of internal control helps to achieve organisational objective and increse effectiveness and efficiency of operations. It helps to protect organisationa assets and prevent frauds.Every one in the organisation has their own role in implementing and monitoring the internal control system.
We can introduce the following control activities to improve the internal control system
1. Segragation of duty
We have to segregate our duties. No one is allowed to complete all levels of a particular task. Programme booking, Performance agreement, fee settelment etc should be assaignmed to different persons
2.Authorisation of transaction
For each transaction above specific amount should be authorised by at least two persons in senior management level. Also we have to fix approval limit of expenses for each level of officers.
3. Safe custody
We have to fix the responsibility of safe custody of our valuables. First we should prepare a register of articles. The person responsible for safe custody should update the details in it. A senior manager should periodically inspect the same.
4.Supervision
A chain of control should be established. Each person has a reporting authority. The well defined organisational structure helps to fix authority and responsibility
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