Defining internal control Internal controls

Question Defining internal control Internal controls are designed to safeguard assets, encourage employees to follow company policies, promote operational efficiency, and ensure accurate accounting records.

Requirements

1. Which objective do you think is most important?

2. Which objective do you think the internal controls must accomplish for the business to survive? Give your reason.

Expert Solution

Step-by-Step Solution

Step 1: Definition of internal controls

Internal controls are the control that controls the internal activities of the company.

Step 2: Most important objective of internal controls

The most important objective of internal controls is to safeguard the company's assets. With the help of safeguards, the company reduces its risks and protects its assets. Because without the safeguard of the assets, the company's risk cannot be reduced.

Step 3: Internal control that accomplishes business to survive

Ensuring accurate and reliable accounting records is the objective that the business must accomplish to survive. Because without it, the sale of the company can not be effectively established, and the company's expenses increase day by day. This might cause a heavy loss to the company and lead to the company's winding up.

Answer

1. Objective of safeguard

2. The objective is to ensure accurate, reliable accounting records

Sahil Dangi answered 1 year ago

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