Briefly describe the purpose of internal controls in a company and the importance of internal controls...

Briefly describe the purpose of internal controls in a company and the importance of internal controls as related to cash.

Expert Solution

Having internal controls within a company can help prevent internal fraud from occurring within their organizations. Internal controls include completing bank statements and checking internal accounts. So management looks at whether the company's assets are misused.

It is extremely important for the company to maintain its management data and financial protection measures in accordance with the laws of the government. Internal controls establish a system for receiving reports of financial transactions, administrative and management functions that are handled in such a manner.

Internal controls are important to help all employees and other individuals in the organization fully understand the purpose of the organization. Internal controls provide reasonable assurance to the customer that the transaction is carried out properly. For example, consumers prefer to protect businesses that have their own internal protection system.

Companies are setting up internal controls to reduce the risk of insecurity. Internal controls are important for the security of cash instruments such as checks and credit cards.

Misleading employees working in high-quality retailers are likely to be tempted to make changes in their use through different cash plans. It provides an easy way to collect cash without having to register and record the sale. Can be used immediately when there is no demand for cash transactions. These issues should be implemented to safeguard cash transactions and employees will have difficulty breaking the rules.

ekkarill92 answered 2 years ago

importance, need and process of internal controls in detail.

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