Augustine-Thompson

Spring 2017

Internal Control Paper Assignment

Pick a company (preferably one you have worked for) and write about their internal controls. You are to cover at least 3 control activities of internal control out of the control activities discussed in class/in the book (see pages 328-331):

• Separation of duties (custody, recordkeeping, authorization and review/verification)
• Personnel policies (drug testing, screening of new employees, adequate and detailed training, and competent supervision, mandatory vacations, written job descriptions)
• Safeguarding of assets (restricted access – physical and/or electronic, security measures)
• Proper authorization
• Adequate documents and records (control numbers, audit trail)

You can change the name of the company to protect its identity, if you so desire (particularly if this is a company for whom you have worked). Occasionally we use papers for research or present them to an audience; thus if you want your paper to be confidential, please write “CONFIDENTIAL” on the paper. Finally,

this paper has to be based on actual experience with a business or company; it cannot be completed using information from a large company’s financial statements.

Your paper is to have the following elements:

1. Start with an introductory paragraph to tell a little about the company you are writing about.
2. You are to write a 1 -2 page single-spaced, typed paper with double spacing between paragraphs. Please use headings for your paper over each type of internal control (e.g., segregation of duties) and then write about it. Cover at least 3 control activities. Your coverage should, at minimum, consist of a thorough description of the control activity in your business, an explanation of what damage or risk to the business has avoided because of the control, and your evaluation of the effectiveness of your business’s specific control.
3. You are to cover 1 weakness in internal control. You may use one of the controls you described already or a different one. Please use a heading for the weakness. You should indicate the type of control that is weak or missing and then describe the weakness, what damage or risk the business is exposed to because of the weakness, and your recommendation of what the company should do to correct the weakness.
4. At the end of your paper, write a summary which addresses the following questions:
5. What are the advantages (benefits) of using internal controls in a company?
6. What risks did you observe in your company as your wrote about its internal controls?
7. What is the most valuable thing you learned from writing the internal control paper?
8. What is the most surprising thing you learned as you wrote about your company?
9. What does your understanding of internal controls mean for your work as a professional?
10. How will what you learned about internal controls affect your future learning, priorities, or behavior?

• Your grade will be based upon the thoroughness of coverage and clarity of writing. Organization of your paper is important. You will lose points if you do not follow instructions on organization, hand the project in late, and/or use poor grammar or spelling. Please have someone read it before you hand it in to help you edit it.