Accounting and Audit Control

Accounting Errors Detection

• Redacting errors in customer accounts helps prevent future sales and potential financial theft.
• Audit and closure of audits ensure correct customer invoices and valid sales/payment data.

Payment Processing

• Customer payments are processed in batches, allowing for batch counting to detect accounting errors.
• All funds are approved to pay customers equal to the balance of all customer accounts.
• Updated customer account numbers are compared with received check numbers to process transactions accurately.

Control Measures

• Independent checks on account accuracy are performed through monthly transfers, prompting customers to report discrepancies.
• Reconciliation of accounting records and general ledger data ensures accuracy of accounts receivable.

ERP System

• Financial posting can only be done manually in the ERP system, eliminating data entry errors.
• Processing errors can still occur, and proper division of labor can reduce this risk.

Fraud Prevention

• The ERP system should be configured to prevent employees from stealing products by selling and writing to colleagues.
• Credit providers should not have the right to issue purchase orders or access customer accounts.
• Debtors should not be able to pay off credit cards to prevent money theft.
• Orders should be adjusted to match all credits on sales invoices, and credit checks should be prevented without customer returns.

Supervisory Review

• A special supervisory review and confirmation is required to ensure the company's position in favor of the customer receiving the product and obtaining credit.

Selection Process

• Selection is the process of choosing the best candidate for a job opening.
• The selection process includes: preliminary reception of applications, selection tests, selection interviews, references and background checks, and a hiring decision.

Selection Tests

• Selection tests are used to assess the match between an applicant and the job requirements.
• Types of tests include: performance tests, performance simulations, and paper-and-pencil tests.
• Well-designed tests are: standardized, objective, have norms, are reliable, and valid.

Selection Interviews

• Interviews are formal conversations to assess a candidate's suitability for a job.
• Types of interviews include: structured, unstructured, mixed, behavioral, and stress interviews.
• The purpose of interviews is to assess if the applicant can do the job, will do the job, and compare with others.

Other Selection Processes

• References and background checks verify an applicant's credentials and past work experience.
• Medical examinations ensure an applicant is physically and mentally capable of performing the job.
• Environmental factors affecting the selection process include: legal considerations, speed of decision-making, organizational hierarchy, application pool, type of organization, and probationary period.

Orientation

• Orientation introduces new employees to their job responsibilities, organizational policies, co-workers, and work environment.
• The purposes of orientation include: developing realistic job expectations, improving productivity, saving time and effort, improving employment stability, and reducing conflict.
• Orientation programs cover: organizational issues (history, policies, benefits) and job-related issues (job objectives, tasks, safety requirements).

Performance Appraisal

• Performance appraisal is a formal system of periodic review and evaluation of an individual's job performance.
• The main uses of performance appraisal include: performance improvement, compensation adjustments, placement decisions, training and development needs identification, career planning and development, and feedback to the human resource function.

The Performance Appraisal Process

• Establishing performance standards based on job descriptions.
• Communicating the standards to employees.
• Measuring actual performance.
• Comparing performance with standards.
• Discussing the appraisal with employees.
• Initiating corrective action as needed.

Responsibility for Appraisal

• Immediate supervisor, peers, self-appraisal, subordinates, group appraisal, or combinations of the above.

Performance Appraisal Methods

• Rating scales
• Critical incident
• Essay
• Ranking
• Work standards
• Management by objectives (MBO)

Employee Placement and Termination

• Placement refers to the assignment or reassignment of an employee to a new job.
• Placement decisions are made jointly by the employee's supervisor and top management, with advice from the human resource department.

Promotion, Transfer, and Demotion

• Promotion is the movement of an employee to a position higher in pay, responsibility, and/or organizational level.
• Transfers involve the reassignment of an employee to a position with similar status and pay.
• Demotions are the downward movement of an employee to a position lower in responsibility, status, and pay.

Termination

• Termination is the permanent separation of an employee from an organization.
• Reasons for termination include: the employee finding a better-suited position, wanting a change, or economic reasons.