B Com Exam > B Com Videos > Auditing and Secretarial Practice > Internal Check - Internal Audit, Auditing and Secretarial Practice
Internal Check - Internal Audit, Auditing and Secretarial Practice Video Lecture | Auditing and Secretarial Practice - B Com
|
55 videos|53 docs|24 tests
|
FAQs on Internal Check - Internal Audit, Auditing and Secretarial Practice Video Lecture - Auditing and Secretarial Practice - B Com
| 1. What is internal auditing? |  |
Ans. Internal auditing is a process conducted by an organization's internal auditors to assess and evaluate the effectiveness of the organization's internal controls, risk management systems, and governance processes. It provides independent and objective assurance to the organization's management and board of directors.
| 2. What is the purpose of internal auditing? | |
Ans. The purpose of internal auditing is to help organizations achieve their objectives by bringing a systematic and disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes. It provides insights and recommendations to enhance organizational performance and ensure compliance with policies and regulations.
| 3. What is the difference between internal auditing and external auditing? | |
Ans. Internal auditing is conducted by employees within the organization, known as internal auditors, while external auditing is performed by independent professionals, known as external auditors. Internal auditing focuses on evaluating internal controls, risk management, and governance processes within the organization, while external auditing focuses on providing an independent opinion on the accuracy and reliability of the organization's financial statements.
| 4. What are some key responsibilities of internal auditors? | |
Ans. Internal auditors have several key responsibilities, including assessing the effectiveness of internal controls, identifying areas of potential risk and recommending improvements, evaluating compliance with policies and regulations, conducting audits of financial and operational processes, and providing recommendations to improve efficiency and effectiveness of business operations.
| 5. How does internal auditing contribute to organizational success? | |
Ans. Internal auditing contributes to organizational success by providing independent and objective assurance on the effectiveness of risk management, control, and governance processes. It helps identify weaknesses or deficiencies in internal controls, highlights areas of potential risk, and provides recommendations to mitigate these risks and improve organizational performance. By enhancing the overall governance and control environment, internal auditing helps in achieving organizational objectives and safeguarding assets.
Text Transcript from Video
so let us now discuss an important
concept called
an eternal control so what is an
internal control let us define these two
words sorry so we have internal which
means within the organization and
control which means to supervise or to
have a hold on something we how does
this function within the organization
how does this operate what is an
internal control so I take an example of
company a B and C and they want to
purchase an asset worth rupees 10 lakhs
now the decision of purchasing the asset
was taken by the management which
directed the purchasing department to
purchase via set accounting department
that actually knows the assets down in
the books of accounts and finally they
use the department so what is an
internal control is that the decision
taken by the management to purchase the
asset worth rupees 10 lakhs was actually
purchased by the purchasing department
first now what are the controls in the
purchasing department that the
quotations were called from now the
comparative decision was made and the
warranty and everything else for the
asset was taken into account that is the
job of the purchasing department moving
on to the accounting department it means
that the property it was accounted for
in the books over the period the
depreciation was charged the suitable
rate was selected and the user
department that it uses the ascent
properly so internal control does not
only kneel in the virtual department
why's their function but it also means
intra department what is the definition
of inner control as defined in the
models of
the government of the objective of the
entity now this overall achievement of
the objective with regards to water on
that the assets are safeguarded that the
functions are properly performed that
the compliance with the regulations are
met and that the reliability of the
finance okay at all
regards to what so overall objectives it
comes to what reliability of the
financial statements then the functions
are properly performed assets are
safeguarded laws regulations and bylaws
are other - so internal control from
another point of view hood a very big
important auditor has to evaluate how
well is the internal control depending
upon his evaluation about the internal
control and its effectiveness during the
review period he will decide about the
quality and the quantity of the audit
evidences to be collected now say for
example in a company like this but the
internal control in the purchasing
department is weak for example if the
auditor has the idea that 10 lakh of
birth and acid was actually purchased
for 9 lakhs and rupees 1 lakh was
misappropriated in that case he will
have to do a detailed analysis he will
have to do a detail in that check so a
substantive procedures to be undertaken
by the auditor depends upon the quality
of the internal control it is not only
in such the forms that the interim
cartoon has to be applied it is also
applied in small firms places like
grocery shops places my CD I'll say of
caffeine all these places needs to have
its own set of controls so how much
evaluation is to be done and what are
the procedures to be followed by the or
depends upon his judgment and his
experience so let us now talk about
internal control in a computerized
environment we know that internal
control is a process which is
established by the management and those
charged with governance to ensure that
the overall objective of an entity is
achieved but the overall objective of
the entity has changed roles considering
the globalization of the economy will
increase in the globalization that has
been increase in the scale of operations
as well scale of operations have led to
the increase in the process of the data
so validating every input and the output
is not practical for the auditors so
what do we do in such an environment the
roles of computers have increased
tremendously with this increase we have
to ensure that the internal control in
the computerized environment of any
entity is maintained now what could be
the possible ways to check firstly
auditors have to ensure that is a proper
login ID and password to gain access to
this computer resources in case if I
have an invalid user ID and in fact
rather invalid user ID in a particular
organization there has to be a prompt
over there or there has to be a certain
notice to be sent to the higher
authorities password needs to be changed
on a periodic basis the server rooms
have to be kept distinctly and
separately with local key there has to
be an l1 l2 mechanism in the sense that
in case if I want to process a
transaction in case of interfere in a
particular Tron
action that means approval from the
higher authority so these are some of
the examples in the internal auditor or
this actually in order to has to ensure
the controls to be maintained in the
computerized environment moving forward
we'll talk about inherent limitations in
the internal control internal control
agreed that it's a process and ensures
that the objective is achieved that the
assets are safeguard and the laws and
regulations are a third to but in no way
does it guarantee that the frauds and
the errors misrepresentation will be
frozen the errors are not going to take
place there always exist a certain
amount of risk in the internal control
as well let me take an example so what
if I have the management of a company
involved in a fraud in that case no
internal control would have a safeguard
so whatever give one charge with the
authority or the one given the authority
to supervise control over the others are
the one misusing them are the one of
using the authority again the internal
controls I saw as a failure in situation
like that is a change in the scenario of
the business where there is a change in
the structure of the business process
the entire establish internal control
according to the old format will not
serve the purpose I'm using a business
transaction will not fall within the
ambit of internal
generally followed from the user
transactions usual transactions are the
one that the company undertakes on day
to day business unusual ones are the one
that covers maybe once a year to ICL
induce interviews internal control will
fail also the procedure established
would of course be like a safe word for
the errors and the fraud but what about
human errors human errors are again not
falling in the ambit of internal control
so we're going to discuss two other
important topics from the point of view
of internal control we have line of
business internal control questionnaire
and internal control evaluation so what
is a letter of weakness now we have
discussed earlier that the internal
audit and the statutory auditors have to
evaluate the internal control within the
organization they have to see that the
internal control is existing and its
operational within the review period so
if they find that the empower controls a
week they will decide to go above the
detail order procedures say for example
in our case that we do the a set of
rupees 10 lakhs was actually purchased
for rupees nine lakhs by the purchasing
department and one lakh was
misappropriated in that case the
internal control in the purchasing
department would be leaked and hence the
auditor of the decided data substantive
procedures to check in depth the process
of the purchasing department and hence
may say that the quality of the internal
control the judgment of the auditors
above the internal control have a direct
impact on the audit evidences poor the
control more the evidences in any given
scenario an auditor has to be rest
assured then sufficient and appropriate
audit evidence --is are we used by him
to give him the reasonable assurance
about the to enter picture of the
financials so in our example when the
auditor was not sure or was having a
doubt about the internal control in the
purchasing department in stock situation
he communicates the facts to the
management and those Charles the world's
such a communication by the auditors to
the management is nothing but letter of
weakness I have a berth suggest it is a
letter it is a company occasion of the
weakness Venus what the internal
controls that he noticed in a process or
in a department most of the times this
letter of weakness not only contains the
weakness and the department but also
contains the materiality of the weakness
and the financials it would also would
want to give suggestions about the
weaknesses and how to correct them
so in short letter of neatness is
nothing but it's a communication from
the auditor to the management and those
charged with governance about the
weakness and the internal control and
also would contain the conclusions or
would contain the solution to those
weaknesses so moving on to internal
conversion and internal control
so you must have what about the surveys
that the people do to arrive at a
conclusion about your particular product
so if I want to serve a simple Tang a
biscuit what I will do is I would
prepare the list of questions relating
to Patania this K go out to the public
at large
getting my answers to those questions
and then evaluate that to arrive at the
conclusion such as are they done is no
different from internal control
questionnaire internal control
questionnaire is a survey more like a
survey I would say in which the
questionnaire the list of question is
prepared by the auditors this list of
question is given to the management of
the company who in turn gives it to the
employees employees answer those
questions and give it back to the
auditors auditors on the evaluation of
these questionnaires arrive at the
conclusion regarding internal control
that is they would know how well are the
internal control design whether or not
this appropriate for a given scenario
how efficiently is it being applied and
whether it is continuously being applied
over the review period questionnaire
generally contains a question about a
particular transaction or a particular
process which has to be answered in
either a yes or no valeting s would
indicate a positive reply and no would
mean the internal control is weak or is
non-existent this know would later on be
evaluated in depth by the auditors and
would follow it into
evaluation so internal control
questionnaire which does not fulfill the
criteria or an answer no actually falls
in internal control evaluation in which
a detail analysis is done by the
auditors and then the conclusion is
arrived at they generally make
selections in this kind of category I
have attached a format for the letter of
weakness and of course it don't work
under questionnaire an evaluation for
your very difference thank you
concept called
an eternal control so what is an
internal control let us define these two
words sorry so we have internal which
means within the organization and
control which means to supervise or to
have a hold on something we how does
this function within the organization
how does this operate what is an
internal control so I take an example of
company a B and C and they want to
purchase an asset worth rupees 10 lakhs
now the decision of purchasing the asset
was taken by the management which
directed the purchasing department to
purchase via set accounting department
that actually knows the assets down in
the books of accounts and finally they
use the department so what is an
internal control is that the decision
taken by the management to purchase the
asset worth rupees 10 lakhs was actually
purchased by the purchasing department
first now what are the controls in the
purchasing department that the
quotations were called from now the
comparative decision was made and the
warranty and everything else for the
asset was taken into account that is the
job of the purchasing department moving
on to the accounting department it means
that the property it was accounted for
in the books over the period the
depreciation was charged the suitable
rate was selected and the user
department that it uses the ascent
properly so internal control does not
only kneel in the virtual department
why's their function but it also means
intra department what is the definition
of inner control as defined in the
models of
the government of the objective of the
entity now this overall achievement of
the objective with regards to water on
that the assets are safeguarded that the
functions are properly performed that
the compliance with the regulations are
met and that the reliability of the
finance okay at all
regards to what so overall objectives it
comes to what reliability of the
financial statements then the functions
are properly performed assets are
safeguarded laws regulations and bylaws
are other - so internal control from
another point of view hood a very big
important auditor has to evaluate how
well is the internal control depending
upon his evaluation about the internal
control and its effectiveness during the
review period he will decide about the
quality and the quantity of the audit
evidences to be collected now say for
example in a company like this but the
internal control in the purchasing
department is weak for example if the
auditor has the idea that 10 lakh of
birth and acid was actually purchased
for 9 lakhs and rupees 1 lakh was
misappropriated in that case he will
have to do a detailed analysis he will
have to do a detail in that check so a
substantive procedures to be undertaken
by the auditor depends upon the quality
of the internal control it is not only
in such the forms that the interim
cartoon has to be applied it is also
applied in small firms places like
grocery shops places my CD I'll say of
caffeine all these places needs to have
its own set of controls so how much
evaluation is to be done and what are
the procedures to be followed by the or
depends upon his judgment and his
experience so let us now talk about
internal control in a computerized
environment we know that internal
control is a process which is
established by the management and those
charged with governance to ensure that
the overall objective of an entity is
achieved but the overall objective of
the entity has changed roles considering
the globalization of the economy will
increase in the globalization that has
been increase in the scale of operations
as well scale of operations have led to
the increase in the process of the data
so validating every input and the output
is not practical for the auditors so
what do we do in such an environment the
roles of computers have increased
tremendously with this increase we have
to ensure that the internal control in
the computerized environment of any
entity is maintained now what could be
the possible ways to check firstly
auditors have to ensure that is a proper
login ID and password to gain access to
this computer resources in case if I
have an invalid user ID and in fact
rather invalid user ID in a particular
organization there has to be a prompt
over there or there has to be a certain
notice to be sent to the higher
authorities password needs to be changed
on a periodic basis the server rooms
have to be kept distinctly and
separately with local key there has to
be an l1 l2 mechanism in the sense that
in case if I want to process a
transaction in case of interfere in a
particular Tron
action that means approval from the
higher authority so these are some of
the examples in the internal auditor or
this actually in order to has to ensure
the controls to be maintained in the
computerized environment moving forward
we'll talk about inherent limitations in
the internal control internal control
agreed that it's a process and ensures
that the objective is achieved that the
assets are safeguard and the laws and
regulations are a third to but in no way
does it guarantee that the frauds and
the errors misrepresentation will be
frozen the errors are not going to take
place there always exist a certain
amount of risk in the internal control
as well let me take an example so what
if I have the management of a company
involved in a fraud in that case no
internal control would have a safeguard
so whatever give one charge with the
authority or the one given the authority
to supervise control over the others are
the one misusing them are the one of
using the authority again the internal
controls I saw as a failure in situation
like that is a change in the scenario of
the business where there is a change in
the structure of the business process
the entire establish internal control
according to the old format will not
serve the purpose I'm using a business
transaction will not fall within the
ambit of internal
generally followed from the user
transactions usual transactions are the
one that the company undertakes on day
to day business unusual ones are the one
that covers maybe once a year to ICL
induce interviews internal control will
fail also the procedure established
would of course be like a safe word for
the errors and the fraud but what about
human errors human errors are again not
falling in the ambit of internal control
so we're going to discuss two other
important topics from the point of view
of internal control we have line of
business internal control questionnaire
and internal control evaluation so what
is a letter of weakness now we have
discussed earlier that the internal
audit and the statutory auditors have to
evaluate the internal control within the
organization they have to see that the
internal control is existing and its
operational within the review period so
if they find that the empower controls a
week they will decide to go above the
detail order procedures say for example
in our case that we do the a set of
rupees 10 lakhs was actually purchased
for rupees nine lakhs by the purchasing
department and one lakh was
misappropriated in that case the
internal control in the purchasing
department would be leaked and hence the
auditor of the decided data substantive
procedures to check in depth the process
of the purchasing department and hence
may say that the quality of the internal
control the judgment of the auditors
above the internal control have a direct
impact on the audit evidences poor the
control more the evidences in any given
scenario an auditor has to be rest
assured then sufficient and appropriate
audit evidence --is are we used by him
to give him the reasonable assurance
about the to enter picture of the
financials so in our example when the
auditor was not sure or was having a
doubt about the internal control in the
purchasing department in stock situation
he communicates the facts to the
management and those Charles the world's
such a communication by the auditors to
the management is nothing but letter of
weakness I have a berth suggest it is a
letter it is a company occasion of the
weakness Venus what the internal
controls that he noticed in a process or
in a department most of the times this
letter of weakness not only contains the
weakness and the department but also
contains the materiality of the weakness
and the financials it would also would
want to give suggestions about the
weaknesses and how to correct them
so in short letter of neatness is
nothing but it's a communication from
the auditor to the management and those
charged with governance about the
weakness and the internal control and
also would contain the conclusions or
would contain the solution to those
weaknesses so moving on to internal
conversion and internal control
so you must have what about the surveys
that the people do to arrive at a
conclusion about your particular product
so if I want to serve a simple Tang a
biscuit what I will do is I would
prepare the list of questions relating
to Patania this K go out to the public
at large
getting my answers to those questions
and then evaluate that to arrive at the
conclusion such as are they done is no
different from internal control
questionnaire internal control
questionnaire is a survey more like a
survey I would say in which the
questionnaire the list of question is
prepared by the auditors this list of
question is given to the management of
the company who in turn gives it to the
employees employees answer those
questions and give it back to the
auditors auditors on the evaluation of
these questionnaires arrive at the
conclusion regarding internal control
that is they would know how well are the
internal control design whether or not
this appropriate for a given scenario
how efficiently is it being applied and
whether it is continuously being applied
over the review period questionnaire
generally contains a question about a
particular transaction or a particular
process which has to be answered in
either a yes or no valeting s would
indicate a positive reply and no would
mean the internal control is weak or is
non-existent this know would later on be
evaluated in depth by the auditors and
would follow it into
evaluation so internal control
questionnaire which does not fulfill the
criteria or an answer no actually falls
in internal control evaluation in which
a detail analysis is done by the
auditors and then the conclusion is
arrived at they generally make
selections in this kind of category I
have attached a format for the letter of
weakness and of course it don't work
under questionnaire an evaluation for
your very difference thank you
Related Exams
About this Video
|
4.79/5 Rating |
|
Dec 19, 2024 Last updated |
Video Description: Internal Check - Internal Audit, Auditing and Secretarial Practice for B Com 2024 is part of Auditing and Secretarial Practice preparation.
The notes and questions for Internal Check - Internal Audit, Auditing and Secretarial Practice have been prepared according to the B Com exam syllabus.
Information about Internal Check - Internal Audit, Auditing and Secretarial Practice covers all important topics for B Com 2024 Exam.
Find important definitions, questions, notes, meanings, examples, exercises and tests below for Internal Check - Internal Audit, Auditing and Secretarial Practice.
Introduction of Internal Check - Internal Audit, Auditing and Secretarial Practice in English is available as part of our Auditing and Secretarial Practice for B Com & Internal Check - Internal Audit, Auditing and Secretarial Practice in
Hindi for Auditing and Secretarial Practice course. Download more important topics related with notes, lectures and mock test series for
B Com Exam by signing up for free.
Description
Video Lecture & Questions for Internal Check - Internal Audit, Auditing and Secretarial Practice Video Lecture | Auditing and Secretarial Practice - B Com - B Com full syllabus preparation | Free video for B Com exam to prepare for Auditing and Secretarial Practice.
Information about Internal Check - Internal Audit, Auditing and Secretarial Practice
Here you can find the meaning of Internal Check - Internal Audit, Auditing and Secretarial Practice defined & explained in the simplest way possible.
Besides explaining types of Internal Check - Internal Audit, Auditing and Secretarial Practice theory, EduRev gives you an ample number of questions to practice Internal Check - Internal Audit, Auditing and Secretarial Practice tests,
examples and also practice B Com tests.
|
55 videos|53 docs|24 tests
|
|
Explore Courses for B Com exam
|
|
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
Related Searches
video lectures
,Summary
,Previous Year Questions with Solutions
,Exam
,Free
,Viva Questions
,Semester Notes
,shortcuts and tricks
,study material
,Sample Paper
,Auditing and Secretarial Practice Video Lecture | Auditing and Secretarial Practice - B Com
,mock tests for examination
,Internal Check - Internal Audit
,practice quizzes
,past year papers
,MCQs
,Internal Check - Internal Audit
,Internal Check - Internal Audit
,Auditing and Secretarial Practice Video Lecture | Auditing and Secretarial Practice - B Com
,Objective type Questions
,Extra Questions
,ppt
,Auditing and Secretarial Practice Video Lecture | Auditing and Secretarial Practice - B Com
,Important questions
;
Study Internal Check - Internal Audit, Auditing and Secretarial Practice on the App
Students of B Com can study Internal Check - Internal Audit, Auditing and Secretarial Practice alongwith tests & analysis from the EduRev app,
which will help them while preparing for their exam. Apart from the Internal Check - Internal Audit, Auditing and Secretarial Practice,
students can also utilize the EduRev App for other study materials such as previous year question papers, syllabus, important questions, etc.
The EduRev App will make your learning easier as you can access it from anywhere you want.
The content of Internal Check - Internal Audit, Auditing and Secretarial Practice is prepared as per the latest B Com syllabus.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup