Lecturer responsible for AUE2602:
Topic 2: Internal Controls
Ms Nicolene Coetzee
Contact details:
What is Internal Controls?
Procedures designed to address and limit potential risks
Types of risks:
•Safeguarding assets of company
•Preventing fraud
•Complying with laws and regulations
•Producing reliable financial information Financial
Statements
•Effective and efficient operation of business
, Who is responsible?
• Board of Directors - overall responsibility and
accountability
• Management - identify risks
- design and implement policies and
procedures to address risks
- maintaining processes ensure policies
& procedures are carried out
• Employees - execution of IC procedures
- success depends on them
Characteristics of Internal Controls
1. IC’s is a process
2. IC’s are effected by people
3. IC’s are not sole responsibility of
management
4. IC’s are not static
5. IC’s are not foolproof
6. Is not 1 IC to address 1 risk
In the exam you should be able to elaborate on above –
refer to J&S p 5/4 for detailed explanations
Topic 2: Internal Controls
Ms Nicolene Coetzee
Contact details:
What is Internal Controls?
Procedures designed to address and limit potential risks
Types of risks:
•Safeguarding assets of company
•Preventing fraud
•Complying with laws and regulations
•Producing reliable financial information Financial
Statements
•Effective and efficient operation of business
, Who is responsible?
• Board of Directors - overall responsibility and
accountability
• Management - identify risks
- design and implement policies and
procedures to address risks
- maintaining processes ensure policies
& procedures are carried out
• Employees - execution of IC procedures
- success depends on them
Characteristics of Internal Controls
1. IC’s is a process
2. IC’s are effected by people
3. IC’s are not sole responsibility of
management
4. IC’s are not static
5. IC’s are not foolproof
6. Is not 1 IC to address 1 risk
In the exam you should be able to elaborate on above –
refer to J&S p 5/4 for detailed explanations
