A framework for online internal controls - Essay Example

Comments (0) Cite this document
The web based tools and the internet facilitate many useful activities of a business that influence customer and suppliers relationship. Need for online control has risen to help guide online based transactions because security is of concern…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER95.1% of users find it useful
A framework for online internal controls
Read TextPreview

Extract of sample "A framework for online internal controls"

A frame work for online internal controls Summary of the article The web based tools and the internet facilitate many useful activities of a business that influence customer and suppliers relationship. Need for online control has risen to help guide online based transactions because security is of concern. Current profusion of online controls like encryption, digital certificates, digital signatures, virtual private networks has created difficulty in understanding objective of online controls. To enable auditors and accountants understand the objective and purpose of internal online control, it gets categorized on the frameworks of Committee of Sponsoring Organization (COSO). A conceptual framework becomes developed based on the objective of internal internet control, and this was useful to the managers. Transfer of data without modification while in transit becomes data integrity while data confidentiality is the inability of unauthorized persons to access data. Encryption, communication protocols, security algorithms become employed to ensure data security and confidentiality. Non-repudiation is requiring covering problems of post Facto denial. It proof that an electronic document becomes sent and received by only the intended persons. Mutual authentication of identity involves verification of identities of transacting parties. After authentication, the user and the machine get identified and get allowed computer system access. This becomes authorization (Deshmukh 4473). Online internal controls become classified on the COSO framework, and this classification is useful for accountants and auditors. The conceptual framework is logic because all its four dimensions can be achieved. Online transactions must comply with the three transaction act. Authorizations of the parties involved in a business transaction get achieved through passwords, digital signatures and certificates, virtual private networks. All these security measures have proved to be effective. These two classifications have enabled us to understand the purpose and objective of online internal control without understanding the knowledge of the technical part (Deshmukh 4474). What are the online internal controls? Based on the COSO, internal controls are a system of balances and checks that keep the business moving according to owners wish while protecting the assets of the business. Different organizations like ISACA, COSO, AICPA, have defined internal controls and its components differently. Committee of Sponsoring Organizations acknowledges the control environment as the foundation of internal control because it gets concerned with the people aspect. The control environment has elements like human resource polices and procedures, management philosophy and operating style, management commitment to ethics. All business face risk and risk management involve analyzing this risk and taking proactive actions to prevent them from happening. Security policy is the online equivalent of the control environment and risk prevention. Security policy becomes designed for the whole information system, and the process is multidisciplinary (Deshmukh 4476). To ensure that management’s directives get carried out, there are polices and procedures that become commonly referred as control activities. Online equivalent of control activities involves perimeter security, infrastructure security, and message content security. Message information security deals with message security as it travels over the internet, extranets, and intranet. Infrastructure security deals with protection of the organization IT infrastructure. Control activities become carried out through passwords, firewall, and digital certificates network ant intrusion techniques. It is the security policy of an organization that deals with information and communication issues. It delineates ways of communication such as pagers, alerts, reports. Comments regarding the article Internal controls should be monitored regularly to assure they are functioning as expected by management. Online monitoring becomes carried out by automated software tools and the human inspection and observation to some extent. The conceptual frame work for internal control becomes based on the aim of online internal control. Technical, human, legal, and audit are the four basic dimensions of internal control that have become used to forge the conceptual framework (Deshmukh 4477). Online control objectives are validity of transactions, authorization, and mutual authentication of identity, end to end data integrity, and non-repudiation, audibility, and confidentiality of transactions. Legal status of an online transaction defines the validity of a transaction. Uniform Electronic Transaction Act, Uniform Computer Information Transactions Act, and Electronic Signatures in National Global and Commerce Acts are the three primary acts that govern electronic based transactions. For the essence of proper funds management, the transaction should show auditability. This prevents fraud because the transactions become validated, properly recorded and controlled (Deshmukh 4478). . Works Cited Deshmukh, Ashutosh. "A Framework for Online Internal Controls." Association for Information Systems 31 December 2004: 7. Read More
Cite this document
  • APA
  • MLA
(“A framework for online internal controls Essay Example | Topics and Well Written Essays - 500 words”, n.d.)
A framework for online internal controls Essay Example | Topics and Well Written Essays - 500 words. Retrieved from
(A Framework for Online Internal Controls Essay Example | Topics and Well Written Essays - 500 Words)
A Framework for Online Internal Controls Essay Example | Topics and Well Written Essays - 500 Words.
“A Framework for Online Internal Controls Essay Example | Topics and Well Written Essays - 500 Words”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF A framework for online internal controls

Evaluating internal controls

...? Week 3 Individual Assignment Connie Johnson December 2, ACC 544: Christine Errico of Phoenix Checklist for evaluating internal controls: Understanding elements of control Generally Accepted Auditing Standards PCAOB Auditing Standard 2 – requires management to assess its internal control and auditor to express opinion on management assessment of internal control and the auditor’s independent evaluation of internal control. Section 404 Sarbanes Oxley Act. Composed of three audits – 1) financial statements of the company; 2) management’s evaluation of internal controls; 3) effectiveness of internal controls Evaluate control risk – probability that the internal controls will fail to prevent material statements and fraud Reliability... of...
2 Pages(500 words)Essay

Accounting / internal controls

...? Accounting Internal Controls Inserts His/Her Inserts Grade Inserts 29 April INTRODUCTIONRicchiute(2006) emphasised the accounts payable processing system for purchase of inventory must include strict internal control policies to ensure the safeguarding and recording of the company’s assets. The research includes a list of internal control weaknesses such as the department, not the purchasing department, should make the purchase requisition, the receiving department should not give the original receiving report to the warehouse, the receiving repot, checks, disbursement vouchers, purchase orders, purchase requisitions does not indicate...
4 Pages(1000 words)Essay

Internal Controls

...? Internal Controls of the of the Internal Controls Introduction The assignment at hand relates to a review of the internal accounting controls for the collections made at weekly services at a Church. I have been asked to serve on a three-person audit team- the other members comprising the internal auditor and a CPA who has just joined. I have to indicate the weaknesses in internal accounting controls in the handling of collections. Discussion The first thing I would recommend is that an audit of the Church’s financial records be undertaken. It is preposterous that no audit has been made in recent years because the same trusted employee has kept both the Church records as well as served as Financial Secretary for the last 15 years... ...
1 Pages(250 words)Essay

Internal Controls Assignment

...?Internal Controls Internal control is an integral part of any business which acts as a form of feedback that looks at the equality and functionalityof different aspects of a business. It is defined as the process designed to provide reasonable assurance regarding the achievement of its two main goals namely, to safeguard the assets of the company from robbery and unauthorized use and to provide financial and accounting information with high integrity. Internal controls aim to comply with the relevant laws and regulations as well. Internal controls can be synonymous to self-monitoring, where the company...
3 Pages(750 words)Assignment

AICPA Ethics & COSO Framework for Internal Controls

...? AICPA Ethics & COSO Framework for Internal Controls Schools Number and of (e.g., October 12, 2009) Question 1: Analysis of Ethical Matters in the Harold Potter Case As a member of the AICPA, Harold Potter has some responsibilities to his customers and the wider society. This is because the AICPA has rules that each member has to adhere to. In the case at hand, there are nine cogent issues that are either breaches or high risk events that could make Harold Potter liable to several actions by the AICPA which could be as severe as getting his membership taken away from him. Entry into Dumbledore Enterprises Through Uncle (1) The first issue is about how Harold Potter gained employment and...
9 Pages(2250 words)Essay

Internal Controls

...?It is important for companies to safeguard the assets and inventory of the firm. Business owners and managers have to protect themselves against internal and external threats. The employees of the company posed an internal threat to the company (Goulding, 2011). A lot of employees steal from businesses whenever they assess that the company does not have any measures to prevent the unethical action of theft. A way for companies to protect the assets of the company is by implementing internal controls. The asset that must be protected the most due to its liquidity is the cash of the company. Cash is the most important asset of a company due the fact it can be used to pay...
4 Pages(1000 words)Assignment

Internal controls

... to attribute the fraud to the fraudsters and to make sure that the strong control is levied by having independent people for accounting, cash collection and invoice making. This would keep a check on all people and chances of frauds would be minimized. d) The company can minimize the customer risk by having daily physical audit of the inventory. If the inventory is found to be missing or less than what is recorded in the book than salesperson should be fined. If this phenomenon lingers on then the company can take strict action and can hold investigation to find out which salesperson or cashier is not doing justice to his job. They can be fired or fined for the amount they have stolen.... There are several risks or loopholes in the process....
2 Pages(500 words)Case Study

Internal Controls

...Introduction to Internal Controls Internal controls are measures defined and supervised by an organization’s top management and board of directors toguarantee that the main objectives of the business are met. Internal controls are established by the organization so that the firm remains effective and efficient, consistence of financial reports and accordance to the relevant laws and regulation. The other objective of internal control is the preservation of company’s assets. This is done to avoid unconditional use by the employees and theft of the assets from the employer. The effectiveness and the efficiency of the firm’s operation deals with the basic goals of the business such as business performance, generation of profits... and the...
3 Pages(750 words)Essay

Internal Controls

...SONY: Internal Control According to Gilbert, Martin 2004, pp.306, internal control is a process for assuring achievement of anorganizations objectives, operational efficiency and effectiveness, dependable financial reporting, and compliance with regulations, laws and policies. In the case of SONY, some of the aforementioned roles of internal controls have not been achieved as a result of various internal control weaknesses and deficiencies. In the recent story carried by the New York Times, the corporation is at a very high risk of incurring huge losses if measures are not taken to protect the gains that...
1 Pages(250 words)Essay

Internal Controls

...Internal Controls Internal Controls Internal controls are business procedures adopted to safeguard business assets, ensure accurate and reliable financial information and compliance with all financial and operational requirements to assist a business in achieving its set goals. The internal controls also prevent fraud by ensuring that the company staff follows the management practices accordingly. The internal controls are crucial to all businesses irrespective of the size. Accountants and business auditors apply internal controls to test...
1 Pages(250 words)Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic A framework for online internal controls for FREE!

Contact Us