Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

6. Internal Controls and Reporting Cash

Five Components of Internal Controls

Financial Accounting

6. Internal Controls and Reporting Cash

Five Components of Internal Controls

Previous problemNext problem

Struggling with Financial Accounting?

Join thousands of students who trust us to help them ace their exams!Watch the first video

Multiple Choice

The objectives of internal control are to:

Increase company profits by reducing employee wages.

Eliminate the need for external audits.

Safeguard assets, ensure the reliability of financial reporting, promote operational efficiency, and encourage compliance with laws and regulations.

Guarantee that all errors and fraud are completely prevented.

Previous problemNext problem

Verified step by step guidance

Understand the concept of internal control: Internal control refers to the processes and procedures implemented by a company to safeguard its assets, ensure the accuracy and reliability of financial reporting, promote operational efficiency, and encourage compliance with laws and regulations.

Clarify the objectives of internal control: The primary objectives are not to increase profits by reducing wages, eliminate external audits, or guarantee complete prevention of errors and fraud. Instead, they focus on safeguarding assets, ensuring reliable financial reporting, promoting operational efficiency, and compliance with laws.

Analyze the incorrect statements: Statements such as 'Increase company profits by reducing employee wages' and 'Eliminate the need for external audits' are not objectives of internal control. These are misconceptions and should be disregarded.

Evaluate the correct answer: The correct objectives of internal control are safeguarding assets, ensuring the reliability of financial reporting, promoting operational efficiency, and encouraging compliance with laws and regulations. These align with the purpose of internal control systems in organizations.

Summarize the importance of internal control: Internal control systems are essential for maintaining the integrity of financial information, protecting company resources, and ensuring that operations are conducted in accordance with established policies and legal requirements.