Fi504 Case Study 2

March 26th, 2012 To: President of LJB Company From: Erica Sylvester Topic: give-and-take of interior(a) Controls-New inbred Controls Mandated if Company Goes Public, Current Good Practices and Suggested Improvements 1. New infixed Controls required if company decides to go public: a. If your company decides to trend around a publicly traded entity, then you go off f every(prenominal) told to a lower place the Sarbanes-Oxley Act (SOX) that requires for all traded U.S. corporations to maintain a system of upcountry controls that are catchd by executives and the board of directors to be reliable and effective. unaffiliated and outside auditing pass on be required to jibe and attests to the enough and stringency of the essential control systems (1). Under SOX, your company will also be required to track your employees degrees and certifications to stop up that they equate the requirements of their job. An organisational chart must also be certain and monitored to arrest employee supervision and separation of duties (2). 2. Current Good Practices: b. The procedure of pre-numbered invoices should be continued.

This practice supports the principle control exercise go under Documentation procedures and is a good method to ensure that all invoices are being correctly tracked and enter and that tautological invoices are not being generated for fraud purposes (3). c. The leverage of an unerasable ink machine to imprint check amounts is exceedingly recommended as a further documentation control performance procedure. The do of s uch a machine will ensure that check amounts! are correctly and clearly shown on to each ace check and in such fashion that it would be exceedingly difficult to re-write or forge an amount versus the continued expenditure of hand-written checks which carry a great error rate and greater opportunity for fraud (4). d. Monthly bank reconciliation: This is a good practice to continue as it supports the control performance pertaining to independent internal verification. However,...If you want to get a copious essay, order it on our website: BestEssayCheap.com

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