...Recommendation Brief for an Internal Accountant Internal auditing helps companies to look at ways of improving and achieving short-term and long-term objectives. Internal auditors are hired to perform internal audits that look at a company’s operations, investigating fraud, financial reporting, safeguarding assets, and compliance of the laws and regulations set for companies. The internal auditors are employed to improve a company’s internal controls. Effective working internal controls detect and prevent fraud that is tested by internal auditors. Benefits of Internal Auditor Understanding the benefits of an internal auditor will help in the decision of hiring an internal accountant. Internal auditors verify the effectiveness of their organization's internal controls and check for mismanagement, waste, or fraud. They examine and evaluate their firms' financial and information systems, management procedures, and internal controls to ensure that records are accurate and controls are adequate. They also review company operations, evaluating their efficiency, effectiveness, and compliance with corporate policies and government regulations (Bureau of Labor Statistics). As an internal auditor he or she will be able to look for any mistakes and address them in the reports. Finding a professional to fill the role of an internal auditor benefits the structure of a growing business, because it prevents the creation of faulty processes and limits the liability the company may be exposed...
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...Recommendation Brief for an Internal Auditor Candace L. Beard ACC 544 May 23, 2011 Joseph Poletti Recommendation Brief for an Internal Auditor Internal auditing helps companies to look at ways of improving and achieving short-term and long-term objectives. Internal auditors are hired to perform internal audits that look at a company’s operations, investigating fraud, financial reporting, safeguarding assets, and compliance of the laws and regulations set for companies. The internal auditors are employed to improve a company’s internal controls. Effective working internal controls detect and prevent fraud that is tested by internal auditors. Benefits of Internal Auditor Understanding the benefits of an internal auditor will help in the decision of hiring an internal accountant. Internal auditors verify the effectiveness of their organization's internal controls and check for mismanagement, waste, or fraud. They examine and evaluate their firms' financial and information systems, management procedures, and internal controls to ensure that records are accurate and controls are adequate. They also review company operations, evaluating their efficiency, effectiveness, and compliance with corporate policies and government regulations (Bureau of Labor Statistics). As an internal auditor he or she will be able to look for any mistakes and address them in the reports. Finding a professional to fill the role of an internal auditor benefits the structure of a growing business...
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...Brief on an Internal Auditor Recommendation Robin Block ACC/544 July 2, 2012 Brief on an Internal Auditor Recommendation An internal auditor can be beneficial to help alleviate the challenges being experienced in your company with internal controls and accounting functions. Internal auditing can provide added value and improve your company’s operations (The Institute of Internal Auditors, 2012). By hiring an internal auditor your company can maintain effective internal controls and reduce business risks (Lehman Brown, 2009). Benefits Your company can enjoy the benefits of having an in house auditor. An internal auditor will be familiar with the culture and direction of the company allowing the auditor to have some foresight in risks that could come. The Internal auditor will work independent from any management within the company, to ascertain the risks, evaluate the risks and report a recommended procedure or policy to mitigate any risk. ” Internal auditors make recommendations that result in additional profits or cost savings for their companies” (Louwers, Ramsay, Sinason and Strawser, 2007, p. 628). The auditor can conduct a number of different audits which can be an advantage the company. A compliancy audit of the HR department can reveal if the company is in compliance with Federal and State labor laws and fair hiring practices. An operational audit can help management understand and execute responsibilities more affectively and improve profitability...
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...Internal Auditor Recommendation Brief The client has mentioned that it has an out-of-control system and is in need of direction, organization, and establishing appropriate controls. Because of the increased attention surrounding increased operating expenses, speculative transactions and corporate fraudulent activities by legislators, shareholders and the media has caused United States companies to focus on implementing and maintaining a comprehensive and effective system of internal controls. These corporations have enlisted the services of internal auditors or created an internal audit department aimed at reducing potential risks that may yield unfavorable results or exposure for the company. The Institute of Internal Auditors (IIA) states the objective of an internal audit assists organizations to accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve effectiveness of risk management, control and governance processes (Louwes, Ramsay, Sinason, & Strawser, 2007). Benefits of employing the services of an internal auditor provide a certified individual who is familiar with the intricate details of the company and can integrate seamlessly into its established processes and controls. Also an internal auditor offers an independent and objective review of the company aimed at recognizing and developing controls, and while improving the efficiencies of various processes and controls with the company’s best interest in mind. In some...
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...Internal Auditor Recommendation Brief Since Somerset Company has an out-of-control system, the company would be subject to audits from the SEC about their financial statements. In order to prevent this from happening, Somerset should consider hiring an Internal Audit Team of three people. The main focus would be to hire an Internal Auditor that would communicate what is required to prevent fraud, safeguard assets, financial reporting standards and to ensure that the company is in compliance with the SEC regulations. The internal auditor would improve Somerset’s internal controls. In this an explanation of the benefits of hiring an internal auditor, describe the qualifications and qualities needed for an internal auditor for this type of company and a recommendation of an internal auditor that meets the benefits and qualifications for this company. An Internal auditor and the team can validate the company’s internal controls and perform tests for fraud, negligence or waste. Internal auditors ensure that the internal controls are adequate and evaluate the company’s financial and information systems for accuracy. In addition to the benefits of hiring an internal auditor would provide the company a variety of audit services such as operational audits, fraud audit, compliance audits and financial statements audits. Operational audits are the most beneficial to Somerset’s needs in controlling their out of control systems. “An operational audit is a systematic review and evaluation...
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...Journal Article Review Kas Internal Auditing (ACC 4012) Article: Code of Ethics for Internal Auditors Harmonized with the International Standards for Internal Audit Summary In the article titled “Code of ethics for internal auditors harmonized with the international standards for internal audit” by George Calota was published in 2008. The article was written to explain how Code of Ethics influences the roles of internal auditors when unified with the International Standards for Internal Audit. This study was carried out to allow both internal and external auditors, private and public business owners with an audit board, within their working environment to be aware of how an internal auditor is supposed to carry out their job and the polices which they should follow. The author’s main focus was on The Josephson American Ethics Institute ethical principles, Romania’s personal ethical principles and its similarities to the fundamental principles of the code of ethics and most of all, how the fundament principles of ethics and professional behaviors for internal auditors are harmonized with the international standards for auditing (Integrity, objectivity, confidentiality and competence). The author seemed to be highly qualified to tackle this particular issue. He is an experienced internal auditor, who has worked with the Ministry of Economy and Finance and also The Central unit for harmonizing the internal audit from Romania. Issues In the article, the author made mention...
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...Recommendation Brief for an Internal Accountant Recommendation Brief for an Internal Accountant Internal accountants or auditors can be beneficial to a company when there are problems within their accounting functions that are causing harm to the financial records. Internal auditors are able to perform many different tasks for the company and if they are an employee of the company already, it can save time when there is an issue because he or she has the knowledge of the internal control systems and may be able to fix the bug or problem in less time. Internal auditors are usually employed because they can compare what the company has now and what it should be in order to stay in compliance with the SOX Act (Advameg, Inc., 2011). Internal accountants can review how reliable the financial information is, review the company’s systems to make sure they are in compliance, make recommendations to improve the system, check the assets of the company and how they are safeguarded, and advise the company if their resources are being used adequately (Advameg, Inc., 2011). Internal accountants can perform different types of audits for the company such as an operational, program, fraud, ethical business practices, compliance, financial, control self assessment audits as well as a systems development and life cycle review (Advameg, Inc., 2011). Employing an internal accountant can save the company money because the company will not have to hire auditors to perform the different...
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...thing that comes to their mind is the IRS. Internal audits however, can help managers manage the organization profitably and more efficiently if internal audit procedures are completed on a regular schedule. Business risk is the risk an entity will fail to meet its objectives, (Louwers, Ramsay, Sinaso, & Strawser, 2007). If an organization fails to meet its objectives repeatedly then the company will fail. To minimize any type of risks decision makers will demand timely, relevant, and reliable information. Information professionals, such as auditors will help to fulfill these demands. According to the American Accounting Association (1973), “Auditing is a systematic process of objectivity obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between the assertions and established criteria and communicating the results to interested users.” Therefore, the following are four environmental conditions that increase user demand for relevant and reliable information: (1) Complexity, (2) Remoteness, (3) Time sensitivity, and (4) Consequences. Complexity Presently, transactions and events are far more complex, in a way that decision makers and investors do not have the expertise to handle them. However, a professional, such as an internal auditor is trained to collect, compile, and summarize the key operating information on his or her own. An internal auditor has the expertise to break down the complex...
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...External auditors do not rely on internal auditors as much as they could – why? How could this reliance be improved? Presented By Mingdi Deng Shirene Horner Yueyang Shi Trevor Stewart Jingtao Wang CONTENTS PAGE ABSTRACT 3 1. INTRODUCTION 3 2. REASONS 3 2.1 INTERNAL AUDITOR ROLES 3 2.2 THE REPORTING AND OBJECTIVITY RELATIONSHIP OF THE INTERNAL AUDITOR 4 3. COLLABORATION IN PRACTICE 5 3.1 COMMUNICATION AND COOPERATION 5 3.2 PROFESSIONAL STANDARDS 5 3.3 RECORDING AND TESTING ACCOUNTING SYSTEMS 6 3.4 SUBSTANTIVE TESTS 6 4. CONSEQUENCES OF INFLUENCE 7 5. RELIANCE IMPROVEMENTS 8 5.1 ATTEMPTS FOR IMPROVEMENT 8 5.2 INCREASE THE EFFICIENCY AND COMMUNICATION METHOD FOR INTERNAL AUDITORS AND EXTERNAL AUDITORS 8 5.3 FURTHER EDUCATION IS...
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...Economic Phenomena [pic] 1. Summary of Valuation A balancing act Sep 15th 2009 From the Economist Intelligence Unit ViewsWire Oman preserves friendly ties with both Iran and the West The Omani ruler, Sultan Qaboos bin Said al-Said, was the first head of state to visit Iran after the controversial re-election of Mahmoud Ahmadinejad in June. His discussions included a proposal for Iran to pump gas to the Gulf Arab state, some of which could be exported using Oman's liquefied natural gas (LNG) facilities. At the same time, Oman is one of the longest-standing and most reliable allies of the West in the Middle East, and it is said to be close to finalising a major order to upgrade its air force with Eurofighter Typhoons. Reports have resurfaced in the press that Oman is in discussions with the British government over the purchase of 24 Typhoon jets, with talk of an agreement being finalised within the next few months. Speculation about a possible deal has been rife for almost a year, but a report in a recent edition of the Gulf States Newsletter suggests that negotiations could be close to a conclusion. The Eurofighter Typhoon is built by a consortium of European aerospace manufacturers, including the UK's BAE Systems. The Royal Air Force of Oman (RAFO) needs to complete the replacement programme for its ageing Jaguar aircraft fleet, which was first introduced in the late 1970s. There are 16 British-supplied Jaguars still in operation following the replacement of...
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...Should external/internal auditors be responsible for detecting client fraud? In 2001 Enron, the seventh largest energy company in 2001, filed for bankruptcy. The event named “Enron Scandal” is considered to be the most shocking incident in American economic history. Bring the country to the edge of disaster, the scandal was basically caused by securities fraud which Enron was charge with. The irrationality of accounting and auditing system encouraged U.S. legislative to respond the scandal, enacting Sarbanes-Oxley Act 2002. SOX Act carried out comprehensive reform of accounting procedures required for publicly held companies, such as promoting and improving the quality and transparency of financial reporting by internal and external auditors. However, there is a controversial issue of whether auditors should be responsible for detecting client fraud. AU Section 110(Responsibilities and Functions of the Independent Auditor) indicates that “the auditor has a responsibility to plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether caused by error or fraud.” In other words, auditors are not expected to provide absolute assurance financial statements because auditors do not examine every transaction and event. The public, however, expect auditor to guarantee all material misstatements. While users who use the reported financial statements expect all illegal issues such as fraud to be detected...
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...September 2010. Pp. 22 - 35 Co-operation between Internal and External Auditors: A Comparative Study on Nationalized and Foreign Banks in Bangladesh Rehana Fowzia Effective co-operation between internal and external audit leads to a range of benefits for both parties, and the clients they serve. This study comparatively examines the influence of different factors on co-operation between internal and external auditors of foreign banks with nationalized banks in Bangladesh. Empirical evidence reveals that co-operation promoted through management and the audit committee is the most important factor for assessing co-operation between internal and external auditors in both nationalized banks and foreign banks. The overall comparative analysis shows that the total difference regarding the contribution of diverse factors on assessing the co-operation between internal and external auditors between nationalized banks and foreign banks is insignificant. But the position of nationalized banks is better than foreign banks in Bangladesh. Keywords: Internal auditor, External auditor, Co-operation, Nationalized banks, Foreign banks. Field of Research: Auditing. 1. Introduction Internal auditors are employees of a company hired to assess and evaluate its system of internal control. To maintain independence, they present their reports directly to the board of directors or to top management. They provide functional operation to the concern. Internal auditors are employed by the organization they audit;...
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...on the financial information she wants to analyze and how it is done. Financial accountants, tax accountants and internal auditors are all accountants in general, but require different training and work methods. A financial accountant records economic data and periodically prepares reports that show profit and other financial information of a company using the generally accepted accounting principles. The reports prepared by the accountant are useful for managers, and also for owners, creditors and the public. Based on information in the reports the public can use the reports to choose a company to invest in. Because a financial accountant is employed by an individual company, she is considered a private accountant. Another type of accountant is a tax accountant. A tax accountant prepares yearly tax returns for individual clients. The accountants have to use constant data such as rates of pay and other information to determine the proper amount of taxes to be paid. These accountants have to take a class once a year to catch up on yearly changes in tax laws and regulations. If a tax accountant has met state experience requirements, she may want to take exams to become a Certified Public Accountant (CPA). A third type of accountant is an internal auditor. Auditors are sponsored by the Institute of Internal Auditors and work within an individual firm. The auditor reviews accounting and operating procedures used by a firm to make sure everything is being run properly. If things...
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...Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.[1] Internal auditing is a catalyst for improving an organization's governance, risk management and management controls by providing insight and recommendations based on analyses and assessments of data and business processes. With commitment to integrity and accountability, internal auditing provides value to governing bodies and senior management as an objective source of independent advice. Professionals called internal auditors are employed by organizations to perform the internal auditing activity. The scope of internal auditing within an organization is broad and may involve topics such as an organization's governance, risk management and management controls over: efficiency/effectiveness of operations (including safeguarding of assets), the reliability of financial and management reporting, and compliance with laws and regulations. Internal auditing may also involve conducting proactive fraud audits to identify potentially fraudulent acts; participating in fraud investigations under the direction of fraud investigation professionals, and conducting post investigation fraud audits to identify control breakdowns and establish financial...
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...non-profit organizations need because it deals with recording the progress of the organizations or institutions, analyzing figures and more importantly determining the future of a firm. This is achieved through analyzing and scrutinizing the current financial records and the previous years’ financial records. Accounting integrates various financial statements such as income statement, balance sheet and also the statement of owners’ equity (Lasser Tax Institute, 2010). This implies that there are various careers that are linked to accounting, and these are with inclusion of accounting clerk, accounting assistants, budget analyst, accounts payable clerk and chief financial officer (CFO). It also has careers such as staff accountant, Certified Internal Auditor and forensic accountants. Career Options Chief Financial Officer (CFO) Chief Financial Officer (CFO) is very important personnel in determination of the overall success of an organization. The officer is obliged to offering advice to the board members and an organization’s Chief Executive Officer in connection to the financial transactions that directly affects the direction to which the organization takes (Backer, 2009). The chief financial officers need to have varied skills and experiences, and also specified academic qualifications to enable them perform their duties effectively and efficiently. They are...
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