Internal Control

Question 1

Meaning of Internal control of credit sales

Answer 1

Internal control for credit Sales refer to policies, procedure and mechanisms implemented by a company to ensure accuracy, integrity and security of the credit sales process. Internal control mitigate the risk of frauds, errors and mismanagement of receivables while also ensuring compliance with accounting standard and regulatory requirements

Question 2

Objective of Internal control of credit sales

Answer 2

1) Ensure accuracy
2) Prevent fraud
3) Manage credit risk
4) Maintain compliance
5) Safeguard assests

Question 3

Key components of Internal control of credit sales:

Answer 3

1) Credit approval process
2) Authorization of Sales
3) Documentation and record keeping
4) Use of technology
5) Customer communication