ipl-logo

Internal Control Environment Analysis

890 Words4 Pages

Internal control plays an important role in accounting. According to the Committee of Sponsoring Organizations (COSO) Internal Control-Integrated Framework, internal control is define as a process affected by an entity’s board of directors, management and other personnel which designed to provide reasonable assurance regarding the achievement of objectives in effectiveness and efficiency of operations, reliability of financing reporting and compliance with applicable laws and regulations. Through internal controls’ policies and procedures, management can acquire reasonable assurance that the company follows the procedures in accordance with achieving its objectives and goals. A poor internal control procedures might result in a company’s failure. …show more content…

We must review five components of internal control in COSO’s Internal Control Integrated Framework in order to explain the failed internal control and governance within Barings. The five internal control components consist of control environment, risk assessment, control activities, information and communication, and monitoring. (Committee of Sponsoring Organizations of the Treadway Commission, 2013) . Control environment is a foundation of all others internal control components. The other four components will be or most likely to be jeopardized if a company does not holding a strong control environment. Control environment is related to the attitudes, actions, policies and management style of an organization. It refers as a tone that set by organization as a model for the employees to comply with and follow. Strong control environment build a positive working environment because it mean every tasks are well control and managed. We can have a further deepen analysis in this …show more content…

Barings put too much trust on Leeson which allow him to involve in the activity in both front and back office. They never suspect there might be a chance for the employee to behave unethically if they get the chance. The human resource policies are too loose. This gave a chance for Leeson to have too much autonomy in the daily operations. This might advocate Leeson to behave unethically in order to get his own interest. The human resources department should always evaluate the behavior and performance of the employees to trace the abnormalities of the

Show More
Related

  • Hypnotherapy Analysis

    677 Words  | 3 Pages

    There one not moment when Mr. Lumbergh was actually a decent human being. I do not think that is ethical at all to have a manager treat its employees in such a poor manner. Each employee was disposable in his eyes. He harassed some of the employees and thoroughly enjoyed making them feel bad. No one would say or do anything about this behavior they honestly just watched it happen.

    Read More

  • Veronica Hardy-Everette Case Summary

    623 Words  | 3 Pages

    As government employees, we are expected to know right from wrong. Government agencies employ memorandums, policies and procedures to keep us abreast with what is to be determined as incompatible activities. In this case, we have a government employee who contracted her husband’s personal business to fulfill her department’s needs wherein she had a direct relationship to the company. This unethical behavior attacks the employee’s character and trustworthiness with the department.

    Read More

  • Controlled Environment In One Flew Over The Cuckoo's Nest

    725 Words  | 3 Pages

    There are four characteristics of a controlled environment and they include the following: status hierarchy,

    Read More

  • Examples Of Ethical Issues In Monsters Inc

    695 Words  | 3 Pages

    The CEO comes in to help to manage the situation but ends up making the situation worse. He not only caused the situation to be unethical but also illegal. The CEO created the situation to be unethical by joining one of his employer's sides and

    Read More

  • Ethical And Legal Issues Of SNC Lavalin Scandal

    1008 Words  | 5 Pages

    Actions which were taken by the company to cover unethical behavior of bribery and

    Read More

  • Four Key Business Functions

    707 Words  | 3 Pages

    An example of this is the use of a new peie of machinery by operations may require human resources to hire appropriately trained workers or train existing workers who are able to operate it. This may include having to terminate existing employment contracts in order to accommodate new workers. The performance of human resource management affects the performance of other KBF’s especially operations. It is the role of HR management to ensure that workers are skilled enough and have the motivation to complete tasks set by managerial staff. If this is completed to a high standard, the business will be able to operate at its highest efficiency rate therefore affecting the other KBF’s than operations.

    Read More

  • Kitchen Best Case Study

    1000 Words  | 4 Pages

    As the company lacked an objective, systematic and enforceable management system, employees always used bribery to reach their business objectives. Apart from this unethical practice, they made use of nepotism to outsource the production process to the factories. Moreover, due to improper vetting procedure, quality control became ineffective. Since the company was not strategic in product provision, the customer retention may deteriorate.

    Read More

  • Examples Of Unethical Behavior In Business

    1191 Words  | 5 Pages

    A) Introduction Unethical behaviors in business affect everyone since you either work in the field or are a consumer of its services. Unfortunately, almost every company usually has individuals who act unethically whether it is for their personal benefit or for the sake of the company they work for. Unethical behaviors in business might be as simple as using company property or funds for personal gain to inside trading and financial fraud. According to The Chartered Institute of Management Accountants, nearly one third of business professionals feel pressured to compromise their ethical standards and are increasingly pushed towards unethical behavior. Moreover, “misconduct is common and accepted by business services professionals, the integrity of entire economic systems is at risk”, states Jordan A. Thomas, partner and chair of the Whistleblower Representation Practice at Labaton Sucharow law firm.

    Read More

  • Summary Of The Missteps Case Study

    296 Words  | 2 Pages

    The major missteps that occurred in this case are as follows: Character Missteps • Simon • made an error in his duties and his shortcoming that warranted the attention of “The Boss” for disciplinary action • The Board • Was not fair and consistent in conducting disciplinary activities (Armstrong 2006, 881) • Simon was not allowed to be present and represented • Matter was not confidential. The action towards Simon was made public by the board. They neglected to inform Simon of the conclusion and did not allow him to answer his case and defend himself. (University of York : Human Resources n.d.) • Presumably no investigation was reviewed The Governing body should have asked questions as of to whether or not Simon was aware of the action

    Read More

  • Stakeholder Theory

    997 Words  | 4 Pages

    As a result, the corporate players, practitioners, and scholars in the ethical field have helped to shape, and communicate ethical behavior at the work place (Terris, 2005, p.48). Mechanisms such as punishment and reward systems have been historically used to inspire ethical behavior, and acceptable group behavior norms amongst employees at the work place (Mayer et al., 2012). In the event that unethical behaviors become part of an organization’s group norms, a successive sequence of ethical problems is likely to follow. This arises from the fact that employees in the organization will lack insightful directive from their leaders, and therefore pursue the unethical behavior without fear of reprimand. Importantly, the organization has to continually consider coming up with long-term ethical solutions to such oversights to keep employees from engaging in unethical

    Read More

  • Apple Macro Environment Analysis

    1481 Words  | 6 Pages

    3.0 Macro Environment that Effects Apple Social-cultural, technology, economic, political and legislation is the elements of macro environment that effects Apple which are described as below: 3.1 Social-cultural ITunes is Apple’s biggest virtual media store. In general, the image of the Apple also depicts the modern individual lifestyle, combining function and conception, resulting in brand recognition and commitment. In conditions of the demographic features, Apple is targeting the two major generations. One generation is mainly consists of working adults, where they might sustain a higher and stable income to purchase Apple’s expensive and complex equipment. Thusly, the sophisticated and high-tech Apple products would definitely

    Read More

  • Essay On Ethical Leadership

    1451 Words  | 6 Pages

    Must employees will notice, criticized, or even emulated the moral failures of their leaders. If we look at our world history, it is filled with examples of how competent leaders have failed from ancient times to modern times. Periodically, we read about unethical behavior in some type of media outlet. Which often corrupts the public’s trust in the leader’s company or agency, then it brings the individual leader into question.

    Read More

  • Methods Of Job Analysis Essay

    978 Words  | 4 Pages

    Introduction Job analyses and job descriptions are used by the Human resource consultants and experts as an elementary unit for many functions of human resource department that includes recruiting and employing, evaluating performance and ranges of salary (Levine et al 1988). As according to Brannick et al (2007), job analyses is an important factor in business that ensures the correct hiring of desired individuals for various jobs. Job analyses protect ensures protection of companies against claims (Veres et al1987), and it help businesses to adequately reward their staffs (Smith et al 1990). According to Fleishman & Mumford (1991), accuracy of Job analyses affect many of the HR functions, So, it is essential to make sure that job analyses is performed properly and in detail. A job analysis implies collecting information on the approaches to evaluate performance, worker-oriented behaviors, job-oriented conducts, and workers behaviors during working with materials, machines, and equipment, job environment and worker’s requirements (Harvey, 1991).

    Read More

  • Literature Review On Employee Performance

    1158 Words  | 5 Pages

    Researchers have shaped compelling evidence for the fundamental relation between employee performance and how management acts with them (Boheene & Asuinura, 2011). They claim that the effectiveness of human resource practices, particularly employee selection, performance appraisals, benefits and reward management, procedures and employee training and development often have a direct effect on the productivity and performance of the employee. And implementing an effective human resource management can enhance the organization 's ability to attract and maintain qualified and motivated employees yield greater profitability, low employee turnover and these invariably lead to higher productivity.

    Read More

  • Literature Review On Unethical Behavior

    2877 Words  | 12 Pages

    Review of Literature Unethical behavior can tarnish a company’s image and reputation. If a company is unethical, they may have to spend additional money to improve their public image, as well as gain back as many customers as possible. The reason I have chosen to use articles that are quite a few years old and that are not so recent is because I feel that they are very good examples of what I am trying to prove in the terms of ethical behaviour within companies and these specific articles relate well to my chosen topic.

    Read More

More about Internal Control Environment Analysis

Open Document