Internal Control and Information Quality Assignment Sample

Introduction - Improving Internal Controls and Information Quality at Toshiba Through Expert Guidance 

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In the Toshiba company there have various issue related to the internal control and misleading information. According to the observation the investigation committee observe that according to the division of duties rules of Toshiba the corporate audit division is in charge of auditing the corporate division the companies, branch companies and affiliated companies.

In following five internal control challenges are some of the most common found in the organisation-

• Separation of duties- This is the major problem in the internal control management system in the organisation. Toshiba also faced this issue. The performance of citical function is typically divided among different employees. In the small businesses with limited human resources, it is not uncommon for a single employees to be soley responsible for completing multiple task in a critical process.
• Policies and procedures-One another issue in the control auditing is policies and procedure,Toshiba has faced this issue because it are responsible to follow all policies and procedure related to the company which has made by the government.
• Documentation- Maintaining accurate and relevant information is another issue for the company in order to maintain internal control. It can be difficult to demonstrate existence of transaction completed , procedure , performed and control in place. Proper documentation can also make it easier and more efficient to reach and respond to question from customer and management and auditor.
• Oversight and review- This is another major problem in the maintaining and conducting the internal control in Toshiba. Company have to face the issue related to pay enough attention to basic internal control monitoring procedure. Proper oversight is essential to the internal control framework and an important aspect of fraud prevention and detection.
• User access right for information systems-Employees are often granted more access to information systems than they actually need to perform their job responsibilities. This may be done for ease of application or because the person granting access (often the IT administrator) does not fully understand the new employee's role. However, providing such access can expose the business to additional risks that business leaders may not be aware of.

As per the above discussion it has been ascertained that there are various issues which have faced by the Toshiba company in order to maintain and manage the internal control for financial reporting. In order to overcome this issues from the company, various strategies are to be followed which are as follows-

• Management personnels should have high integrity and ethical value and be committed to integrity performing key internal control procedure.
• Key control performed by management personnels can overcome the lack of segregation of duties. COSO suggest reviews of accounting systems reports, inspections of supporting documents.
• Company should develop its internal management system through which it can reduce the challenges regarding internal control system. It should hire more talented and skilled accountant employees so as they can contributes their best participation in the maintaining and updating the financial information.
• The system of internal control should maximise effectiveness and efficiency by including that are tailored to the nature, size and complexity of the entity. Since the policies and procedures are usually informal for smaller entities management personnel should communicate internal control through frequent contact with accounting personnel.
• With these internal control prevent all error or fraud from occuring in business can minimise.
• Board of governance should have more hand on oversight involvement in the entity's activities. Some board members may even perform monthly entity level control such asd inspecting and approving supporting \documentation for check written.

Recommendation

As per the above discussion it has been ascertained that in order to maintain the internal control system company haver to effectively monitor its business activity and function related to financing and accounting. Further more, Toshiba should effectively monitor the activities of the financial department so as it can properly implement the internal control action.Management personnels should have high integrity and ethical value and be committed to integrity performing key internal control procedure.

Conclusion

Internal control can be defined as a systematic accounting and auditing process through which reliable financial information can be managed and controlled in order to attain specific objective in the business enterprise. Effective control assists in reducing the risk of asset's loss and helps in ensuring that plan information is complete and accurate as well as financial statements are reliable. From this project it has been concluded that Company should develop its internal management system through which it can reduce the challenges regarding internal control system. It should hire more talented and skilled accountant employees so as they can contributes their best participation in the maintaining and updating the financial information.

Refrences

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Online

Total Quality Management (TQM) .(2016). [online].Available Throught<http://searchcio.techtarget.com/definition/Total-Quality-Management>.[Accessed on 11 January 2017]