What are the techniques of internal control system? Discuss with examples.
CS Executive · Company Accounts & Auditing Practices · PYQS · June 2015
What are the techniques of internal control system? Discuss with examples.
Answer & Explanation:
There are two types of techniques used in internal control system Preventive internal control techniques and Detective internal control techniques controls. (I) Preventive Controls techniques are designed to discourage errors or irregularities from occurring. They are proactive in nature that helps to ensure departmental objectives are being met. Examples of preventive controls techniques are: Segregation of Duties: Approvals, Authorizations, and Verifications Security of Assets (Preventive and Detective) (II) Detective Controls techniques are designed to find errors or irregularities after they have occurred. Examples of detective controls techniques are: Reviews of Performance Reconciliations Physical Inventories Internal Audits
Topics: Auditing
Related Questions in this Topic
- What are the objectives of review of "Employee Relation" and draw an internal control questionnaire on it?
- What are the Powers or Rights of Auditors prescribed under Section 143(1) of Companies Act 2013?
- "Test checking is a system of sampling employed by the auditor for the purpose of reducing the volume of detail checking...
- What are the important points to be considered while reviewing the internal control in the area of sales return?
- "An auditor appointed Under Rule 3 of the Companies (Audit and Auditors) Rules, 2014 is required to submit a Certificate...