Theory Flashcards
What are the characteristics of private companies?
cannot have more than 50 share holders
right to transfer shares is restricted
What are the characteristics of private exempt companies?
not more than 20 shareholders
exempted from ACRA
no need audit if profit <5 million
What are the 7 principles for internal control?
Reliable and competent personnel authority responsibility rotation of duties, separation verification adequate and accurate documentation physical controls and security
What is verification? what are examples
checking accuracy
independent means
trial balance
bank rec
What is authorisation?
validate course of action
What is responsibility
fix responsbility for functions
What duties must be separated?
authorisation
recording
custodianship (keeping asset)
How should documents be done?
sequentially numbered
simple in design
prepared simultaneously as soon as possible
What are physical controls and security?
safeguard assets
What documentation should be made? how should they be handleD?
payment or receipts
pre-numbered receipts
cheques numbered
control listing
E.g. of authorisation
signing of cheque by official
acknowledged by recipient
e.g. of separation of duties
petty cash custodian
authorising officers
control listing
banking intact person
