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Checks & BalancesInternal Controls to Achieve a Successful Audit

Once Upon a Time…

Approximately $96,000

18 months

Mid 30s female

YMCA finance director and accountant

What are Internal Controls?

…a process effected by an organization's structure, work and authority flow, and people and management information systems, designed to help the organization accomplish specific goals or objectives. It is a means by which an organization's resources are directed, monitored, and measured. It plays an important role in preventing and detecting fraud and protecting the organization's resources

Internal Control

What are Internal Controls?

Separation of Duties:

Checks & Balances

Permissions

What are Internal Controls?

Role Based Access Control Using Technology:

DAXKO Operations

DAXKO Accounting

Internal Controls Process

Establish Environmen

tAssess Risks

Control Activities

Monitor Performanc

e

Establish Environmen

tAssess Risks

Control Activities

Monitor Performance

Establish Environment

Establish Environment

A Receptive Environment Requires a Top Down Approach

Establish Environment

Define Roles

Assign Responsibilities

Communicate Clearly

Establish Environment

Establish Environmen

t

Assess Risks

Control Activities

Monitor Performanc

e

Assess Risks

Assess Risks

Vulnerability to Theft

Vulnerability to Mistakes

Vulnerability to Data Compromise

Vulnerability to Misrepresentation

Assess Risks

Vulnerability to Theft

Vulnerability to Mistakes

Vulnerability to Data Compromise

Vulnerability to Misrepresentation

Assess Risks

Vulnerability to Theft

Vulnerability to Mistakes

Vulnerability to Data Compromise

Vulnerability to Misrepresentation

Assess Risks

Vulnerability to Theft

Vulnerability to Mistakes

Vulnerability to Data Compromise

Vulnerability to Misrepresentation

Assess Risks

Vulnerability to Theft

Vulnerability to Mistakes

Vulnerability to Data Compromise

Vulnerability to Misrepresentation

Establish Environmen

tAssess Risks

Control Activities

Monitor Performanc

e

Control Activities

Control Activities

Prevention of Theft

Prevention of Mistakes

Prevention of Data Compromise

Prevention of Misrepresentation

Control Activities

Prevention of Theft

Prevention of Mistakes

Prevention of Data Compromise

Prevention of Misrepresentation

Control Activities

Prevention of Theft

Allocate new apply one time adjustment permission

Separate duties for shift close-outs and deposits

Separate duties for invoice entry and posting

Separate duties for check printing and signing

Activities to Implement

Control Activities

Prevention of Theft

Prevention of Mistakes

Prevention of Data Compromise

Prevention of Misrepresentation

Control Activities

Prevention of Mistakes

Assign account permissions to increase simplicity

Separate duties for entry and posting of journal entries

Use importing feature to import entries

Activities to Implement

Control Activities

Prevention of Theft

Prevention of Mistakes

Prevention of Data Compromise

Prevention of Misrepresentation

Control Activities

Prevention of Data Compromise

Restrict users to applicable branches or departments

Restrict users to necessary major codes

Activities to Implement

Control Activities

Prevention of Theft

Prevention of Mistakes

Prevention of Data Compromise

Prevention of Misrepresentation

Control Activities

Prevention of Misrepresentation

Budget for Revenue before Expense

Establish levels of review

Encourage use of comments

Lock down budget after board approval

Activities to Implement

Establish Environmen

tAssess Risks

Control Activities

Monitor Performanc

e

Monitor Performance

Monitor Performance

Use the Event Log in DAXKO Operations and DAXKO Accounting to monitor performance

Accounts Payable

General Ledger

Budget

Monitor Performance

DAXKO Accounting

Review

Establish Environmen

tAssess Risks

Control Activities

Monitor Performanc

e

Action Items

Determine your Vulnerabilities

Set Goals to Improve Internal Controls

Utilize Roles and Permissions

Establish Policies for Monitoring the Event Log

Evaluate Processes on a Regular Basis