Buffalo State CollegeInternal Control Program

Presented to:

Buffalo State CollegeLine Staff

Delivered by:

BSC IC Program &Department Managers

Internal Controls…

• Improve the likelihood that the right things happen and the wrong things do not

• Will succeed or fail depending on the attention which people give it

• Are a process, not just a set of rules

• Impact every aspect of our campus

College Mission

• A well defined mission provides direction and stability to an organization

• Buffalo State College is committed to the intellectual, personal, and professional growth of its students, faculty, and staff. The goal of the college is to inspire a lifelong passion for learning, and to empower a diverse population of students to succeed as citizens of a challenging world. Toward this goal, and in order to enhance the quality of life in Buffalo and the larger community, the college is dedicated to excellence in teaching and scholarship, cultural enrichment, and service.

Accountability

• Key component at all levels for effective organization

• Everyone has a role to play in an internal control system

• It’s also the law - New York State Internal Control Act

Communication

• Communication is the exchange of useful information between and among people and organizations to support decisions and coordinate activities

• Communication should be timely, useful and complete

• Lines of communication should be up, down, and across an organization

• Staff should be able to communicate problems and suggestions

Control Activities

• Tools or processes - help prevent or reduce the risks that can impede accomplishment of the College's objectives and mission

• Can be manual or automated

Examples of Control Activities

• Admission process

• Purchase Requisition process

• Accounts Payable process

• Property Control process

• Personnel process

• Payroll Timekeeping process

Risk

• Risks are events that threaten the achievement of the College’s objectives and mission. We must ensure each risk is assessed and handled properly.

• The cost of internal control should not exceed the benefit derived.

BenefitsCosts

Risk

Types of Controls

• AUTHORIZATION / APPROVALS

• VERIFICATION

• SEPARATION OF DUTIES

• SUPERVISION / MONITORING

• SECURITY

• REPORTING

Who Is Responsible for Internal Controls?

• EVERYONE

•Senior management: Makes sure they are in place in all areas

•Employees: Follow controls and report problems or improvements

Employee Responsibilities

• Fulfilling your duties and responsibilities stated in your job description

• Meeting performance standards

• Attending education and training programs

• Taking steps to protect assets against waste, loss, unauthorized use and theft

• Reporting breakdowns in internal control systems to your supervisor

• Looking for more efficient ways to perform the controls

• Not using your official position to secure unwarranted privileges

Manager Responsibilities

• Maintaining an office environment that encourages the design of internal controls

• Documenting policies and procedures that are to be followed in performing office functions

• Identifying the control objectives for the functions and implementing cost effective controls designed to meet those objectives

• Regularly testing the controls to determine if they are performing as intended

Internal Control Process

• Identify Functions

• Assess Risk / Vulnerability

• Conduct Internal Control Reviews

• Take Corrective Action

Internal Control Review

Checks Whether Controls Work by:

• Evaluating if Controls Are Adequate

AND

• Testing Whether Procedures Are Followed

Internal Control Testing

Makes sure controls “on paper” are:

• Actually being used as designed

• Really meet the control objectives

Areas with Weak Controls

Some signs of weak controls:

• Cannot meet deadlines for supplying information

• Incorrect or unclear information

• Unusually high employee turnover

• Crowded, poorly organized files

• Poor employee morale

Why Is Internal Control Important?

COMPLIANCE with applicable laws/policies

ACCOMPLISHMENT of the entity’s mission

RELEVANT and reliable data

ECONOMICAL and efficient use of resources

SAFEGUARD assets

Summary

• Overview of Internal Controls

• All Employees Have Responsibility for Internal Controls

• It’s Not Rocket Science

• It’s Not Just a Good Idea – It’s the Law!

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