Internal Controls

 

In this presentation we will introduce the topic of internal controls. Internal Controls been policies within an organization in order to achieve certain objectives those objectives including the safeguarding of assets, having reliable accounting records, efficient operations, and company policy alignment. We’ll get further into what each of these categories mean in detail. However, first we want to discuss the fact that internal controls will change from organization to organization and industry to industry will have similar objectives between organization to organization industry to industry, however, the customization of the internal controls will differ in order to have an optimal amount depending on size of company and type of industry. For example, a small company often one run by one individual will have very much fewer internal controls for multiple reasons. One that that individual can really monitor A lot more of the transactions for a small company and have direct contact with the transactions that are taking place.

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Statement of Equity From Trial Balance 17

More in this presentation we will take a look at the statement of owner’s equity and see how to construct the statement of owner’s equity from the trial balance. When looking at the trial balance, we can see the accounts will be in order with the assets and then the liabilities, then the equity and then the revenue and expenses. The equity accounts being broken out here of owner capital and draws. But it’s a little deceiving to break out this equity section. Because the trial balance really is showing both a point in time the balance sheet account permanent accounts up top and timing accounts which are going to be the revenue accounts down below. When we think about the point in time for total equity as a whole. We’re really considering the entire blue area here. This is one of the most confusing concepts to really know when you’re looking at these financial statements.

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