Internal Controls

Question 1

What are internal controls

Answer 1

Measures put in place to help achieve your objectives

Question 2

Payroll controls (3)

Answer 2

• Personnel files must be maintained for all employees
• access to personnel files must be limited
• detailed time sheets should be used to record the hours employees work

Question 3

Controls for fixed assets (3)

Answer 3

• must be safeguarded physically against theft
• detailed records of fixed assets should be maintained
• lost or stolen items must be reported immediately

Question 4

Controls for stock inventory (3)

Answer 4

• when stock is received compare with items on the list
• proper authorisation when buying stock
• extra safety measures put in place for expensive items

Question 5

Controls for cash receipts (3)

Answer 5

• Division of duties (DOD) 2 people must check the money
• all receipts must be deposited in the bank immediately
• all receipts should be entered promptly in the CRJ

Question 6

Controls for cash payments (3)

Answer 6

• Business debit & credit card must be safeguarded physically
• access to business online banking facilities should be limited and strictly controlled
• PIN numbers and online banking details should be memorised and kept secret

Question 7

Controls for petty cash (3)

Answer 7

• should only be used when payment cannot be made by eft
• access to petty cash should be limited to one person
• documentation should be required for all petty cash payments

Question 8

Controls for Debtors (3)

Answer 8

• must be a policy for credit approval
• credit checks should be performed regularly
• interest should be charged on overdue accounts

Question 9

Controls for creditors (2)

Answer 9

• quantity of goods received should be checked against the invoice from creditors
• invoices must be properly processed before payment