What are some examples of internal controls in a business?

What are some examples of internal controls in a business?

Internal controls are processes designed to ensure the integrity of financial and accounting information. Examples include segregation of duties, authorization of transactions, and regular audits.

Can you explain segregation of duties?

Segregation of duties involves dividing responsibilities among different people to reduce the risk of error or fraud. For instance, one person may handle cash receipts while another records them.

What role do audits play in internal controls?

Audits help verify that internal controls are functioning effectively. They assess compliance with policies and identify areas for improvement.

Are there any specific internal controls for inventory management?

Yes, specific controls for inventory management include regular stock counts, tracking inventory levels, and using inventory management software to monitor transactions.