Finance and Internal Controls Essay - 697 Words

Finance and Investment Controls Just as all cycles discussed in this proposal the finance and investment cycles are vital to the return of borrowed assessments and the value (and longevity) of the company. Corresponded or intertwined to that of the investment cycle and business cycle, the Finance cycle deals with the company’s ability to pay back investors and entities that have facilitated finance to the company’s mission and vision. The finance cycle commences from the initial moments of obtaining investments to the moment they are paid off. The investment cycle extends the point of investment to the time the investment is no longer receiving any cash flow. Both the finance and investment cycles include processes such as the paying†¦show more content†¦When performing controls on the account balances Existence controls the auditor is to examine securities maintained by the investors to see what securities do exist within the company. The Rights and Obligations controls check to see what investor owns and has rights over what particular security by examining a sample of securities (from brokers’ advices) throughout a particular year. Completeness protocols has the auditor make sure all dividends, interest and securities information are recorded truthfully and specifically. Valuation and Allocation controls ensure that all sales of securities have been recognized (whether there is a gain or loss in income). Valuation and Allocation has the auditor examine brokers’ invoices for cost basis for securities purchased. Valuation and Allocation will also determine if there is any change (decline or otherwise) in the value of any particular investment security. Disclosures are the act of uncovering all information of a company’s statements for the review of existing and potential investors. This vital data is pertinent to investment decisions investors must make. To ensure investors are well informed controls implemented will ensure investments are classified and understood. All information including footnotes of general ledger and other statements will be examined to determine if the information is accounted for and listed properly. Board of Directors minutes, discussions, and loan agreements are alsoShow MoreRelatedEssay on Finance and Internal Control976 Words   |  4 Pagesdocument is either destroyed or concealed from government investigation. 2. Name and briefly describe the five components of COSO’s internal control framework.(10 points) The Control Environment: This relates to the control consciousness of people within the work environment/organization. This is the basis for all the other components of internal control. 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