ACCOUNTING REPORT

Internal Control and Accounting Systems



Table of Contents

1.Terms of Reference2

2.Executive Summary4

3.Methodology5

4.Introduction to the Organisation5

4.1External Regulations affecting the organisation6

4.2Key Stake Holders (External)7

5.The Accounts Department8

5.1Key Internal stakeholders8

6.Review of the Accounting System9

6.1Working methods and Practises10

6.2Record Keeping Systems12

6.3Training12

7.Internal Control and Analysis of Fraud13

7.1Internal Systems of Control13

7.2Analysis of Fraud14

8.Recommendations to improve15

9.Cost Benefit Analysis18

Appendices20

Appendix 1 - Organisation chart20

Appendix 2 - Fraud matrix21

Internal Control and Accounting Systems

Terms of Reference

This report reviews the accounting system and particularly the effectiveness of the internal controls of the company Cookridge Carpet. This report gives recommendations to improve as well as perform cost benefit analysis for the recommended strategies.

Executive Summary

After reviewing the accounting system and assessing the strengths and weaknesses and the effectiveness of the internal controls of the company, several recommendations are presented to minimize the weaknesses and improve the efficiency of the operations. The training staff to use updated accounting software will help in performing more accurate and fast work, rather than mistakes in the work and it will improve the productivity. Reducing the stress of manual work will increase the morale of the staff. The company should hire some full time employees in the accounts department as there is always someone in the accounts department and it is easier for staff to communicate with each other, this will help getting the work done more quickly and accurate. Computers should be centralised to ensure all the work such as the sales, purchase ledger, the payroll and the other financial transactions can be accessed for other staff members if needed. The current computers in the accounts department need to be networked for this. This would enable the organisation to have central accounting records. Also would enable members of staff to manipulate or access data on other staffs work for emergencies or if they need to access the data to complete the work. Using a common system will motivate staffs which are effective and also it provides them with appropriate information they might need to require to complete work. Also it would lead to fewer errors in manual calculations which may benefit both staff and the business. This would be a benefit to the business as it will ensure better planning of cash flows, and will also ensure suppliers are paid on time which will reduce the risk of suppliers putting Cookridge Carpets on stop due to unpaid bills which could lead to allot of problems. Using a proper petty cash system would also be beneficial to the organisation, to ensure petty cash is recorded accurately and appropriately, this would reduce the risk of theft or poor recording of cash taken from the tills.

Methodology

Very critical and in-depth information was needed to prepare this report. The Methodology I used to collect the data information was questionnaires and interviews from employees and clients. Besides this, internet research database and relevant professional journals such as SAGE, EBSCO and Emerald were used to assist in the recommendation part.

Introduction to the Organisation

Cookridge Carpet's is a large carpet, soft furnishings and bed dealership in ...