KnowledgeLeader Blog

The Best of KnowledgeLeader: Q3 2017

Posted by Protiviti KnowledgeLeader on Fri, Oct 13, 2017 @ 09:02 AM


In case you missed them, these were the ten most popular tools and publications on KnowledgeLeader last quarter:

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1. Internal Controls Checklist

This checklist sample provides a list of items to consider when assessing internal controls for common business processes.

It focuses on accounts receivable and sales controls, accounts payable controls, accrued liabilities and other expenses controls, cash disbursement controls, cash funds controls, cash receipts controls, general accounting controls, fixed-assets controls, intangibles controls, inventory and cost of sales controls, investments controls, long-term liabilities controls, notes receivable controls, payroll controls, prepaid expenses and deferred charges, and shareholders’ equity controls.

 

 

 

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2. Process Classification Scheme (PCS)

The Process Classification Scheme (PCS) is a framework that helps organize information about a company, according to relevant business and/or industry processes, and defines the individual functions of a business that should take place at the strategic, operational and tactical levels. Depicting each function as a defined process or sub-process helps promote a common language and provides a “roadmap” to help identify processes and related risks and potential controls that may be applicable to the organization. Note: The PCS is not an all-inclusive list of existing business processes. Companies should customize the PCS (processes and associated sub-processes) to fit the facts, circumstances and culture of the organization.

 

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3. Internal Audit Risk Assessment Questionnaire

 Internal audit performs this risk assessment to identify and prioritize key risks to best allocate the internal audit resources for the next year. This risk-based approach is focused on surveys/interviews of a cross-section of management personnel to solicit input from the potential customers of an internal audit function. The output from the surveys and interviews can be used to develop an audit plan that creates broad coverage through a blend of internal audits, control self-assessment and targeted external audit coverage.

 

 

 

 

 

 

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4. Procurement Internal Controls Audit Work Program

 This sample audit work program reviews the internal controls in an organization’s procurement process.

Sample questions to consider include: Are purchase orders based on authorized requisitions? Are purchase orders properly coded to identify the cost objective (direct, indirect or inventory)? Are purchase orders serially controlled and accounted for? Is the use of standardized purchase orders required? Are effective numerical document controls or status reports maintained to record the receipt of purchase requisitions? Does the purchasing department maintain specifications for all materials and services used by the contractor? Are requirements combined where appropriate? Are the receiving and inspection functions separate from the purchasing function?

 

 

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 5Accounts Payable RCM

 An RCM provides an overview of different control objectives that organizations should take into consideration and the corresponding controls to safeguard the company against risks which may arise if not checked timely. Once customized to an organization, this document can help the user in assessing each control. The control assessment can then also be summarized to develop an action plan.

This document outlines risks and controls common to 5.2.1 Process Accounts Payable in a risk control matrix (RCM) format. 

 

 

 

 

 

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 6. The Updated COSO Internal Control Framework: Frequently Asked Questions

Companies should familiarize themselves with the New Framework, determine their transition plan, and communicate to stakeholders the release of the New Framework and its implications to the organization. In this booklet, we address various questions regarding the New Framework from COSO, including the reasons why it was updated, what has changed, the process for transitioning to its use, and steps companies should take now.

 

 

 

 

 

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 7. AR and Cash Application Process Flow

Cash application is a process relating to accounts receivable (AR), where incoming payments are applied to the corresponding customer invoice. Whether it is a cash or wire (EFT) payment, a monthly bank reconciliation is performed by the accounts payable (AP) assistant and the AR assistant within two days of month-end. It is then reviewed, signed off and filed by the financial controller.

This document can be used as a general guide to understand and review the AR and cash application process. Organizations should continuously update and monitor the processes included in this document to ensure that they accurately reflect business operations.

 

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 8. Director of the Project Management Office Job Description

 This job description provides the purpose, overall responsibilities, and selection criteria for the position of director of the project management office.

 

 

 

 

 

 

 

 

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9. Internal Audit Plan and Report to the Audit Committee


This audit report presents an anticipated two-year internal audit plan, including details of each audit area.

In this sample, the company established an internal audit function. The results of the internal audit strategy analysis were presented to the board of directors. Subsequent to this meeting, the company's executive management and the audit committee requested and contributed to the creation of an internal audit plan. 

 

 

 

 

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 10. Human Resources Review Audit Work Program

The objectives of this audit work program are to obtain an understanding of the human resources (HR) process, evaluate the effectiveness and efficiency of the HR process and related internal controls, and evaluate the quality and integrity of information systems supporting the HR process.

Some of the sample work steps include: Conduct a planning meeting to discuss scope, approach and timing with internal audit team manager. Determine auditee’s expectations. Determine the appropriate contacts for the review. Obtain sufficient understanding of the audit area. Obtain and review any relevant material on the human resources process.

 

 

Topics: KnowledgeLeader tools, KL Top Ten

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