Establish and Maintain Internal Controls to Protect Your Business Assets
As fraud and embezzlements continue at very high rates and for increasingly larger amounts, safeguarding assets can be challenging for many businesses. Cyber-crime and other sophisticated methods have added layers of complexity for businesses, making detection and prevention even more difficult, while increasing insurance rates and the cost of doing business. Businesses need strong internal controls to detect and prevent intentional as well as unintentional misappropriations of assets, and to help avoid material misstatements on financial statements.
A comprehensive internal controls assessment can help identify problem areas including segregation of duties, security weaknesses, and operating and accounting procedures needed to help ensure that a company’s assets are protected and financials are materially accurate. Armed with this information and proper professional guidance, businesses can be better positioned to prevent losses and misstatements, rather than have to deal with the aftermath.
Internal Controls Requirements:
- Segregation of Duties – Ensure that no one person has too much control over transactions and the reporting of activity from those transactions.
- Oversight – Make sure proper authorizations and reviews are required and applied consistently when assets are acquired, transferred and recorded.
- Physical Security – Make certain cash, equipment, inventories and other assets are secured physically, counted and reconciled to records periodically, and compared with item descriptions on control records.
- Training – Provide adequate training and guidance for employees to ensure they have the knowledge necessary to carry out their job duties, the appropriate level of direction and supervision, and are aware of the proper channels for reporting suspected improprieties.
- Documentation – Create policies and procedures on day-to-day operations that are accessible to employees. Well-documented controls keep operations running smoothly and securely during employee absences and transitions.
Don’t let weak internal controls expose your business to losses, fraud, and material errors. Contact one of our specialists to learn how we can design and implement or assess your existing internal controls to protect your company.