Fi504 Course Project 2

FI504 Accounting and Finance Case Study #2 evaluation of Internal Controls caution Mr. President, The Sarbanes-Oxley knead of 2002 is a United States federal law which sets crude or enhanced standards for all U.S. humankind companies. The reason that this Sarbanes-Oxley Act of 2002 bill was created was because of a number of major(ip) corporate and accounting system scandals. When these scandals occurred they cost investors billions in losings because the sh ar prices fell it move human race confidence in our securities markets. That is why it is important to surveil with the Sarbanes-Oxley Act of 2002 requirements. This means that LJB would be required to maintain a system of indwelling harbor. The controls essential be reliable and effective, which the decision makers and plank of Directors must monitor. Also, an outside attender must confirm that the control systems are sufficient. The annual re regularisee must include an affidavit report from a registe red public accounting firm. Failure to travel along with the standards of SOX subjects LJB Company, along with the executive officers and board of directors to severe penalties of fines and imprisonment.

The five principles of internal control are the following: * Establishment of Responsibility * Segregation of Duties * backup Procedures * physiological Controls * Independent Internal Verification * Human Resource Controls The ascendencys decision to start using pre-numbered invoices is an important section of the Documentation Procedures of Internal Control. Pre-numbered documents helps to ensure a transaction has! not been omitted, as well as ensuring that the transaction has not been put down more than once. We recommend the use of indelible sign to grade checks, which is a form of physical control some(prenominal) want the accountants decision to lock the checks in a safe over the weekend. Using indelible sign prevents the checks from macrocosm easily altered, which contributes to stronger internal controls. One is...If you want to accept a full essay, order it on our website: BestEssayCheap.com

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