Would like some assistance writing a 800 word paper discussing what defines internal controls and list some examples that might help a small business owner.© SolutionLibrary Inc. solutionlibary.com 9836dcf9d7 https://solutionlibrary.com/business/accounting/internal-controls-7ghi
For effective internal controls to be in place, it is important to have excellent communications. Information must be communicated to effect control. The information may be related to performance, risks, control environment and the organizational plans. Suggestions for small businesses are the need for the business to communicate effectively, if the business gets information that alerts it to internal and external risks. For instance, does the business come to know in advance of change in demand for its products? Are there adequate controls related to software used by the business. These include input control, process control and output control. Consider the example of payroll processing in a small business, are there controls in place to ensure that no unauthorized person can add data, process data or get hold of its output. One of the most important internal control activities is that of segregation of duties. What does segregation apply to? It applies to starting a transaction, approving the transaction, recording the transaction, comparing the balances, handling of assets and preparation of reports. In case of a small business, the businessman should ensure that at least two persons carry out these activities. Another important objective of internal control is protecting the assets of the business. There needs to be properly set up limits on the access to equipment, inventories, securities and cash. Every small business should periodically count the assets and compare the physical count figures with those in the ...