Managers and internal controlsWhat assurances are there.doc

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1、Managers and internal controls:What assurances are there?Jason Oberle12 PUBLIC MANAGEMENT | MARCH 2012Investigate the systems if weaknesses are found By Jason Oberle.What can local governments learn from abuses at Enron, Tyco, WorldCom, and other companies caused by sloppy adj.肥大的；潦草的；草率的；稀薄的；庸俗感伤的o

2、r nonexistent internal control, an absence of ethical adj.伦理的, 道德的, 凭处方出售的behavior, and improper oversight n. 疏忽, 失察, 监管, 看管? Subsequently后来, the Sarbanes-Oxley Act of 2002 .外资银行开设子银行设立了存款保险审批国建监理无不良记录要求，2002年萨班斯-奥克斯利法（The Sarbanes-Oxley Act of 2002）也对外资银行分支机构在公司管理和会计审计方面提出了新国建监理无不良记录要求。 was enacted

3、 vt.制定法律, 扮演 to prevent further gross adj.总的, 粗鲁的, 公然的, 荒唐的, 令人讨厌的 n.总量, 总额 vt.总共赚得 adv.总共地abuses in the private sectors n.部门, 部分, 区域 n.计扇形, 扇区 vt.使分成部分.The enactment of Sarbanes-Oxley led to debate about internal controls and the ability of local and state governments to provide reasonable assuranc

4、es that public assets资产，优点，有用的东西, public funds, and public transactions会报交易 are not likely to undergo遭受，经历 significant abuses. The specific connection between this article文章，物品，条款 and Sarbanes-Oaxley is the mandate命令，要求，授权 of having internal controls that ensure vt.担保, 保证, 使安全,确保 prudent adj.谨慎的, 有远

5、见的, 精明的 and proper financial reporting.This article shares .分享, 分配, 共有 vi.分享 n.一份, 股份, 分担, 犁头 techniques and insight n.洞察力, 见识,深刻的理解 about what local government managersmyself includedcan learn from the private sector.Focusing on the use of internal controls, this article aims to increase a managers

6、 understanding of these controls. It will report on what managers should know about control systems, and it outlines .大纲；轮廓 vt.概述；画出轮廓 the process for recognizing potential weaknesses in the control systems and evaluating评估 those weaknesses; it also addresses 提出the managers responsibility. It conclu

7、des by outlining the biggest fallacy n.谬论, 谬误的推理associated with implementation n.履行, 落实, 装置 of these management controls in local government.Takeaways重点看点 Internal controls often need to extend延伸 beyond basic adj.基本的, 基础的, 初级的, 含硅少的n.基础, 根本,计BASIC语 legal requirements. Internal controls require ethic

8、al, political, and professional leadership. Internal control systems are organic有机的 and not static静态的, meaning they require regular and timely及时适时 review n.复习, 回顾, 检讨, 评审 vt.检阅, 评论, 温习, 检讨 vi.写评论 . Prudent adj.谨慎的, 有远见的, 精明的and proper financial reporting requires internal control systems.What Manage

9、rs Ought to KnowInternal controls, also referred to here as management controls, are the systems and techniques that managers use to ensure vt.担保, 保证, 使安全,确保 an organization or department are accomplishing vt.完成, 实现 what is intended adj.预期的, 故意的. Simply stated, the systems and techniques described h

10、ere provide reasonable assurances that government departments and the organization as a whole are meeting intended objectives n.目标,宗旨 and goals n. 目标 in an ethical adj.伦理的, 道德的, 凭处方出售的, legal, and efficient adj.效率高的, 胜任的 manner.Government controls are frequently adv.频繁地, 经常地 established adj.确定的, 建立的

11、, 制定的 动词establish的过去式和过去分词形式 in order to comply vi.顺从, 遵照, 答应 with legal or regulatory adj.管理的, 控制的, 调整的requirements. The control systems are designed and intended vt.想要, 打算, 意指 to prevent or detect发觉, 察觉, 探测 problems as well as keep assets n.资产, 优点, 有用的东西secure. They also assist vt.帮助, 协助 vi.帮助, 出席

12、 n.帮助, 协助,助攻, 协助的器械 in preventing problems because individuals are deterred vt.阻止, 威慑, 威吓 from violating .侵犯, 违反, 扰乱, 亵渎, 强奸rules or laws for fear of being caught by the system.To understand how control systems assist 帮助 managers, it is essential to understand the broad definition of the concept. In

13、ternal controls are the processes put in place by management and other personnel n.职员, 人事部门. They are designed to provide reasonable assurances that an organization willachieve its objectives in an efficient manner, produce reliable adj.可靠的, 可信的 reports, comply vi.顺从, 遵照, 答应 with rules and regulatio

14、ns n. 规程, 条例, and safeguardn. 保卫者, 保护措施 vt. 保卫, 保护 assets. To this end, the control structure can assist managers in achieving program objectives by producing reliable performance and financial reports, complying with laws and regulations, and safeguarding assets.Internal control systems are intende

15、d to provide reasonable assurances, not guarantees. Also, the cost of implementing n.工具, 器具, 当工具的物品vt.实施, 执行, 向 . 提供工具(或手段the control and the control system should never exceed vt.超过, 超出 vi.领先 the value of the benefit. The system should always incorporatev.合并, 组成公司 adj.合并的,公司组织five basic components

16、:(1) the control environment, (2)risk assessment.评价, 评估, 评定, (3) control activities,(4) information and communication, and (5) monitoring. .监视, 控制, 监测, 追踪Recognizing Potential WeaknessesWhen a review of internal control systems occurs, a manager may notice problematicadj. 问题的, 有疑问的 descriptions n.描述

17、, 刻画, 类型, 说明书of a department.部门, 系, 科,处, 局or organization. If so, the manager should initiatevt.开始, 创始, 启蒙, 介绍加入 n.创始人adj.新加入的,启蒙的 an investigation of the systems.During any investigation, two of the most easily identifiable adj.可辨认的weakness indicators are 1) significant problems in the information

18、resource management system and 2) vulnerabilities n. 脆弱点in the accounting n.账户,帐目, 赊账, 老主顾, 报告, 描述, 解释, 说明, 估计, 理由, 利益, 好处, 根据 v.解释, 导致,报账,把 . 视为, 归咎(于) system. Both of these are fairlyadv.公正地, 相当地easy to addressn.住址, 网址, 电子邮箱地址, 称呼, 致词, 讲话, 演讲, 谈吐 v.称呼, 发表演说, 提出, 写地址, 处理 . Other indicators.指示器, 指示剂

19、, 指示牌 计算机 指示符are the lack of political or senior adj.地位较高的, 高级的, 年长的, 资深的 n.上司, 年长者, 长辈, 大四学生 manager commitment n.承诺, 保证, 信奉, 献身, 委任,交押 to a soundadj.有效的, 合理的, 可靠的,全面的, 健康的, 完好的, 酣睡的, 严厉的internal control environment; this is recognizable, in part, by high turnover n.营业额, 流动, 成交量, 翻覆,半圆卷饼adj.可翻转的 ra

20、tes in key management positions and an inability 无能, 无力 to recruit .吸收(新成员), 征兵, 招聘and retain vt.保持, 保留, 记住, 聘请competentadj.有能力的, 足够的, 胜任的 professional staff.Literature on internal control systems also suggests another indicator of problems is a changing control environment, including adding new pro

21、grams or major changes in existing programs. In todays economic environment, however, significant fiscal adj.财政的, 国库的 constraints n.约束, 强制, rather than internal control deficiencies 缺乏may be the reason for such change.Finally, significant material重要的关键的 weaknesses are often cited引用 in the findings o

22、f an audit审计查账 report. If weaknesses are cited in an audit and the corrective action process is slow, this could indicate weakness in the internal control process.Evaluating the Control SystemWhen evaluating the internal (management) control system, the evaluation must incorporate four activities: (

23、1) organizing the evaluation process, (2) segmenting 分割the organization into manageable adj.易办的, 易管理的, 易控制的 and similar categories种类 of activity, (3) conducting .行为, 举动, 品行 v.引导, 指挥, 管理 vt.导电, 传a risk assessment of objectives, and(4) determining the location .位置, 外景拍摄地, 定位, 地点of available internal c

24、ontrol information.Organize the process. Before any work can be successfully accomplished in the evaluation process, these preconditions must be met: (1) a culture of organizational integrityn.完整, 完善, 正直, 诚实 and ethical values, (2)an organizational commitment to competency.能力, 胜任, 技能,(3) clear and c

25、onciseadj.简明的, 简要的 objectives in each area of evaluation, and (4) a supportive adj.支持的 attitude from senior managers and elected officials.The process of the evaluation requires clear and definitiveadj.权威性的, 明确的, 确定的, 决定性的 n.限定词assignment of responsibilities, establishment of internal reporting requ

26、irements, establishment of procedures to document the process in a way that can be readily adv.容易地, 迅速地, 乐意地, 欣然understood, and organization of staff involved.The most critical of these requirements is assigningvt.分配, 指定, 指派, 归因,确定 n.受让人to individuals or teams responsibility for preparing internal c

27、ontrol plans, conducting risk assessments 立项评估and reviews, taking corrective actions on identified deficiencies, 立项评估and providing reports and reasonable assurances that objectives are being met.To accomplishvt.完成, 实现 these tasks effectively, a manager must select an appropriate team that considers

28、the evaluation to be of value and appliesvt.应用, 涂 vt.使专心从事 vi.申请, 有关联 the appropriate level of seriousnessn.严肃, 认真, 严重性. The team must be capable and must possess sufficient knowledge, skills, and experience to complete vt.完成, 使完美；使圆满, 填（表格等the task or be appropriately trained in the area of interna

29、l controls.Todays economic environment and significant fiscal adj.财政的, 国库的Constraints. 强制, 被约束, 拘束, rather than Internal Control deficiencies缺乏, 不足, 缺陷, 缺点, May be the reason for program Changes, which in turn Can be Indicators of problems.Segmentn.部分, 弓形,瓣, 段, 节 vt.分割 the organization. The segmenta

30、tion step requires significant organizational knowledge. The purpose of this step is to ensure that the size of the department, agency, or unit being evaluated is not too large to be effectively evaluated or not so dissimilar adj. 不同的 that it cannot be evaluated in conjunctionn.结合, 关联,连词, (事件等的)同时发生

31、 with other parts of the organization. This step in the process is different in nearly every organization.Conduct risk assessment. The risk assessment n.评价, 评估, 评定step varies by organization insofaradv.到这种程度, 在这个范围内 as it is not the organizational risk as a whole that is being assessed; instead, the

32、 assessment applies to the systemic adj.全身的, 系统的and inherent risk of the organization as it relates to the organizations objectives. This may differ significantly from one organization to the next.These are the eight basic tenets of the risk assessment step: Identify .鉴定, 识别, 认明 vi.认同, 感同身受 the func

33、tions to be assessed. Obtain information of prior adj.优先的, 在前的, 更重要的 adv.居先,在前 risk assessments. Define each functions control objectives. Identify inherent adj.固有的, 内在的 risks. Identify other risks. Identify each functions control technique. Identify existing knowledge of the general control environ

34、ment, inherentadj.固有的, 内在的organizational risks, existing controls. Form conclusions as to risk; Then make recommendations建议.Gather available information. In this information-gathering step, particular sources may provide good information to consider before, during, and after the evaluation of the co

35、ntrol system. Before the evaluation, the information may help determine areas for examination. n.考查, 考试, 审讯, 检查During and after the evaluation, the information may help in comparative adj.比较的, 相当的 n.比较级 analysis of activities and in making recommendations. 建议These sources n.来源, 发源地, 原始资料 v.从.获得 are

36、people with experience and knowledge of daily operations, management reviews, audit n.审计, 查帐 vt.旁听, 审计reports, program evaluations, annual performance reports, supplemental adj. 补充的, 增补的, 不定期的 reports, regular activity reports, and individual experience and knowledge. Valuable sources include electe

37、d officials, city or county managers and administrators, chief executive adj.行政的, 决策的, 经营的,计算机执行指令n.行政主管, 行政部门,决策者 officers, and chief administrative officers. Throughout the process, leadership is important.Leaderships n.领导, 领导才干Responsibility Leadership styles vary. The important thing to remember

38、 is that leadership is responsible for deciding where control is needed, designing and documenting n.文件, 公文, 文档 vt.记载, (用文件等)证明 control components, placing controls into operation, monitoring and improving the effectiveness of controls, testing controls periodically, reporting on the status and effe

39、ctiveness n.有效性, 效力of controls, taking timely adj.及时的, 适时的 adv.及时的and effective actions to correct deficiencies缺陷, and tracking n. 小路, 跑道, 踪迹, 轨道, 乐曲v. 跟踪, 追踪progress on corrective actions.Managers and others in leadership are also responsible for creating an atmosphere of ethical adj.伦理的, 道德的, 凭处方出

40、售的 behavior and leading an ethical organization. I believe that a lack of ethical behavior was the major component n.零部件；元件, 组成部分；成分 adj.组成的；构成的 in the demise of Enron and Tyco and that the recognition n.承认, 认出, 赏识of that fact provided the impetus n.推动力, 刺激 for the passage of Sarbanes-Oxley. Establi

41、shing and maintaining an ethical culture throughout the organization is every bit as important as establishing and maintaining financial controls.The Big Trap .圈套, 陷阱, 困境, 双轮轻便马车, U（或S）型管道；防臭瓣v.设圈套, 陷入（困境）My experience in professional management has led me to recognize shortfalls in the planning, im

42、plementation, and monitoring of internal control systems. A local government can be diligent incompliance with state laws, municipal adj.市政的, 市的 n.政府证券 code n.密码, 法规, 准则 v.制成法典,把 . 编码development, and regulatory adj.管理的, 控制的, 调整的compliance n.顺从；服从；遵守, 屈服, 柔度,灵活性 and still miss the mark on implementin

43、g n.顺从；服从；遵守, 屈服, 柔度,灵活性 good internal controls. To understand how this can occur, consider the reasons why legal and regulatory structures are set up and the reasons why internal controls are implemented adj.应用的动词implement的过去式和过去分词in an organization.Legal and regulatory structures are established i

44、n organizations under the mandate n.命令, 指令, 要求, 授权 v.把(某一地区)置于委任管理of law by the state or federal government. If an organization fails to carry out the mandates, it often has some detrimental adj.有害的 n.有害的人或事consequences for the organization. These consequences may be criminal n.罪犯 adj.犯罪的, 刑事的, 违法的p

45、enalty, civil penalty n.处罚, 惩罚, 不利, 罚球, or ineligibility for specific types of financial transfers n. 传输or payments支付.Internal or management control structures are implemented n.工具, 器具, 当工具的物品vt.实施, 执行, 向 . 提供工具(或手段) in an organization under the leadership of elected officials or appointed staff mem

46、bers in an effort to努力 monitor activities aimed to provide reasonable assurances that the organization will meet its objectives efficiently and effectively as well as provide reliable performance and financial reports. The biggest fallacy n.谬论, 谬误的推理 is that no distinction n.荣誉, 差别, 优秀, 对比, 区分exists

47、 between internal controls and management n.管理, 管理部门, 手腕controls, and the reason for implementation n.履行, 落实, 装置 of internal controls is strictly to adhere vi.遵守, 坚持, 粘附to legal mandates n.命令, 指令, 要求, 授权 v.把(某一地区)置于委任管理下. The trap for any organization is the belief that implementing legal or regulat

48、ory requirements alone will provide management with the necessary control structure to meet organizational objectives. Therefore, it is critical that an organization establishes controls that align vt.使结盟, 使一致, 使成一行, 调整, 排列 vi.成一条线 with management goals and not merely with legal or regulatory requirements.Managers seeking additional information on internal controls have a number of resources. These resources are available in-house adj.（机构）内部的 adv.（机构）内部地in the local governments finance or accounting department, through consultants n.顾问, 咨询者, 会诊医生(for example, a third-party