Internal Control Case Study Essay

2158 Words Mar 1st, 2012 9 Pages
LJB Company’s Internal Control
Recommendation Report
February 2012

Prepared for:
LJB Company
President
Finance Department

Prepared by: Cauretta Bell

Recommendation Report 2012
It is my immense pleasure to report and evaluate the findings of the internal control procedures to the President of LJB Company regarding recommended changes for the organization to utilize internal control requirements. We will provide useful recommendation so that LJB Company will be fully prepared to go public in the near future. Being completely open to our recommendation, the President of LJB Company can expect the organization proficiency level of internal control will secure assets, improve the trustworthiness of the accounting records, amplify
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Now, if the President of LJB feels as if the current accountant is not qualified for the promotion then please employ a Treasurer of Controller.
Physical Controls
The uses of physical controls are extremely important. It relates to the safeguarding of assets and enhancing the accuracy and reliability of the accounting records. There should be some form of regularity for the company to benefit. Examples of regularity would include monitoring equipment, safes, locks, alarms, and time clocks for employees. Documents are presented as evidence that the transaction and events have occurred. As a result, the accountant established procedures for documents by using pre-numbered invoices, to ensure that all documents are accounted for. The company needs to have something in place to prevent a transaction from being recorded more than once, or conversely, from not being recorded at all. We recommend a log system to be implemented to confirm that all invoices are processed, accounted for and documented within an accounting period. In the aforementioned paragraph pertaining segregation of duties the account with multiple duties ensure that he places the checks in the safe overnight and weekends so that unauthorized personnel that do not have access will the opportunity to take checks that does not belong to them. It is apparent there are not guidelines for petty cash. This system needs to be addressed and modified immediately. There

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