Question

1. Describe with examples six control that an organization can utilize to fortify their accounting system during a crisis such as covid-19.

Answer 1

The Pandemic Covid-19 outbreak globally has impacted the organisations significantly at the various levels.

There are few controls which the organisation should keep into consideration while accounting during the Covid-19 , few of which are being listed below :

1) Effect of the moratarium period in the finance costs and other various areas of the entity :

The organisation should keep into consideration the moratarium period which is being prescribed by the state and the central government for the payments of the interest and other compliances.

Therefore the effects of the same should be kept into consideration while the recording of the various aspects in the books of the enterprise.

2) Temporary extension and reliefs provided alongwith the compliance of the various statutes and legislations:

The entity should be able to avail the temporary relief measures which are being prescribed by the departments.

In addition , to the above the department should comply the requirements in the prescribed in the comprehensive manner.

3) Impact on the revenues aspects :

The organisation should assess the impact on the impact on the revenue and the changes in the recognition circumstances and the other provision at the time of the crisis .

4) Impact in the contractual obligations :

There are various contractual and other commitments which are being done by the organisation , so the fulfilment and honoring of all the options and ways for the contractual terms should be kept into the consideration for the purpose of the crises and general business management.

5) Interim financial information systems :

The team should report and design the controls in relation to the financial information system for the interim period in such a manner that they are able to design and decide on the various aspects of the business and future plans.

6) Fair value measurements , provisions ,Going concern assumptions :

The organisation should revisit and reasses the basic accounting and the other assumptions into the consideration for the purpose of the accounting.