I would also utilize the segregation of duties to ensure no one person can defraud the company by being allowed to record and control assets. In addition to segregation of duties, I would also utilize an establishment of responsibility, so that every person has individual tasks such as, the person writing the check will not be an authorized signor of checks. Lastly, I would definitely employ the independent internal verification so that there are watchdogs in every aspect of accounting, thereby providing oversight from theft or
Unique username and passwords should also be giving to each employee. This will help prevent corruption or theft of information. If something goes wrong they are responsible. Limit access to the server room as well. Only certain personnel should have access to the room.
In fact, all countries consider this type of payment illegal as I mentioned before. Extortion as I said is a little different; it is illegal to practice in United States but in some countries is not considered illegal. Extortion can be justified once a payment can be justified by stating, the payment is needed in order to keep the contract or work started. All these types of bribes are considered illegal except for extortion that is only considered illegal in the United State. Meanwhile, the fact behind these laws of bribery is somehow complicated and also depends on how the gifts are being presented or how it’s being demanded for.
Case Study 2 FI504 1. If LJB Company decides to go public, there will need to be some changes to their day-to-day operating practices. The Sarbanes-Oxley Act of 2002 (SOX) was put in place by the United States government to require publicly traded corporations to have an adequate system of internal control. External auditors must check the internal control system, and specific requirements must be met. There are five primary components of internal control systems: a control environment, risk assessment, control activities, information and communication, and monitoring.
Attn: President of LJB Company It is my understanding that LJB Company is a local distributor and has asked for the assistance of our accounting firm to evaluate their current system of internal controls with the objective in mind to go public in the future. As you may be aware, the Sarbanes-Oxley Act of 2002 (SOX) requires all publically traded U.S. corporations to maintain adequate system of internal control. Internal control consists of all the related methods and measures adopted within an organization to safeguard its assets, enhance the reliability of its accounting record, increase efficiency of operations and ensure compliance with laws and regulations. Within the internal control, there are six principles of control activities that I will focus and how LJB Company is currently implementing these principles and where improvement may be recommended: First, let me state the six principles of control activities I will be referencing: 1) Establishment of responsibility 2) Segregation of duties 3) Documentation procedures 4) Physical controls 5) Independent internal verification 6) Human resource controls Currently, LJB Company has established a few internal control principles well and I would like to encourage you to continue these activities as they relate to the process in place. Pre-Number Invoices: Using pre-numbered invoices is a good example of documentation procedure.
The problem with having different job descriptions and having the same title is very big. It effects every aspect of the business and in this case the bank because one employee has a totally different viewpoint on the job then the other person and it can cause inflict of interest especially towards the clients. In order to organize the bank again and enure that the restudied job information was correct I would do some job analysis procedures as a consultant to show CPIB how to prevent the employees from changing their job descriptions. I would use certain job analysis that we discussed in chapter 8 such that would rate the employees and evaluate them and that way they can train the people that needed to understand their job descriptions better. I would use the 360-degree performance appraisal and have some assessment centers.
The Sarbanes-Oxley is the act of 2002. This act consist of originals names of the Investors Confident Act, Public Company Accounting Reform, Corporate Accountability Act, Investors Protection Act of 2002, and many more. The main purpose of these Acts is to focus on legislation. This Act is to support the public with support, and to maintain at a high level of confidence in the financial reports of public companies. SOX were introduced to be known with its purpose.
Bureaucracy puts rules ahead of personal whim so that both clients and workers are all treated in the same way. From this impersonal approach comes the commonplace image of the “faceless bureaucrat (J. (2012) p.116).” In the scenario the rules were clearly broken and this placed personal whim of the student employees ahead of rules. This means that clients and workers are not treated in the same way. If other co-workers had to hear the inappropriate conversations and were offended by it, then it means that all employees were not treated in the same
These factors can be managed by equal responsibility, a code of conduct and ethics, options to stay late to make up hours, and expressing the seriousness of stealing time; it is not harmless and very serious. 2. What does the word Whistleblower mean (legally speaking)? Give an example of whistleblowing. A whistleblower is a person who has knowledge of illegal activity going on within the company that management and other executives may not be aware of and they notify the appropriate person to put a stop to the illegal activity.
Case 4-6: 1. Yes, I do believe that auditors should be held liable in situations like ZZZZ Best. It is true that ZZZZ Best management worked hard to deceive the auditors. However, the auditors in the ZZZZ Best case failed to maintain their professional skepticism and objectivity. They failed to probe deeper into the company’s operations.