Business Sustainability Internal Control Systems

Question: Discuss about the Business Sustainability for Internal Control Systems. Answer: Introduction: The weakness in the internal control systems has been identified by eh auditor who was engaged to conduct the auditing by the name of Carl Kens Associates. The customer base has been witnesses to increase from year to year and hence there is need to institute strong controls for these issues in order to secure the customers. The increasing customer database is witnesses as result of gaining good reputation by the mode of conducting good business. The other irregularity in the books of accounts was traced by the auditor where he discounts accorded to customers was recorded in the invoices as amount and there was no indication of standard prices. Allan said that Sustainable Business Movement in financial perspectives of companies (Washington, 2001, p.633). This fluctuation and destabilization of prices made the financial statements reflect a negative flow of cash. Reconciliation was simply cooked since the accountant obtains the cash from the drawers and compared with the deposit, the variances witnessed justifies that there is insufficient accountability. Line managers did not authorize all the timesheets as it is recommended by the corporate and the strategic review process. There was reluctance in collecting the debts and recording the amount of money that the company was entities to be pays. The debtor reconciliation is not done as per the guidelines and acts of the organization. Rennie said that growing green, boosting the bottom line with sustainable business practices (Ricky, 2008, p.111). Job roles was not well defines and allocation of these tasks was not adequately planned by the human resource manager and the operations manager who aware assigned the responsibility of these functions of employees training induction and specialization in the production process. Failure to renumber cash receipts made it impossible for the revenue collection and recording of the cash appropriately. The third party bank statements must be reconciled with the company books for ascertaining the correctness and accuracy of these financial statements The view of the board that Houtiz is financially viable is true to the extent that the reports especially the fact that the cost of goods sold is less than the total annual revenue generated. This justifies the factor that the company is able to attain the break-even point and pass it. The profits are made as it has been depicted by the gross profit of the actual results of 1415904. In Queensland as $1,000,000 and the tax limit is set at 4.75 % of the annual income or the monthly revenue obtained from the GST collected. This amount is inclusive of the total wages and the salaries increment in the records of the financial statement of the clients who are employees of the entity. According to the information provided the transaction price is inclusive of the 10% that was incurred in the remuneration package of the directors and managers entitled with the responsibility of ensuring that the sales executives have got good incentives to promote the company brand accordingly. Australian tax office is entitled to an amount considerable via a statement known as the business activity. The payments are remitted on monthly basis to prevent over accumulation. The gross profit margin will not be maintained because of the future uncertainties that are inherent in the systems and the organization in general. The auditor is able to identify that there are weaknesses in the internal controls of the organization. The matching principle will enable the company improve on its budget by applying it in such a way that the expense are recorder during the period in which they take place, This is performed regardless of when the cash transfer occurs. Developing the budget is ascertained by use of the principle which is associates with the accrual method of accounting. The sales of the company are made through the sales representatives reps who earn a commission of approximately 11%. The commission is considered in drafting of the budget and the representation on that given day of making the report to the stakeholders. Given that the company has %59, 000 sales in the end of year the company will be able to budget for the commission payable to the representatives and consultants of $5,900. Matching principle The matching principle requires that the amount mentioned be reported on the December income statement along with the related sales of $59,000. An adjusting entry is necessary for the debits of the commission expenses and credits. Anderson argued that the critical importance of sustainability risk management journal of Risk Management (Faith, 2001, p.522). The account group is the report that is made as result of the budget report that has been already been customized to group accounts and thus shows entries of the activities posted from the ledgers. The journal entries of the expenses incurred are transferred to this account in order to balance the figures and obtain the summary report The profit and loss statement of Houtiz Ltd might be different each time depending on whether the individual assigned he responsibility of preparing it have filtered the report. Criteria of sorting are considered where the change is anticipated in the tracking of the sales account of the entire operations. Houtiz actual budget variance report for the year ended 2011 The reason as to why these variances have occurred is as result of the following issues is that the mix of resources that were needed to authorize the proposed activities was not assigned to the departments for cost allocation. The spending demands are characterized with uncertainties and this makes the budget a lengthy process and cumbersome for the company. Thomas said that Report of the World Commission on Environment and Development (Erick, 1997, p.233). Conclusion There was difficulty in getting in to the magazines in order to enjoy the benefit of some offers that would have uplifted the budget. The budget planners did not account for the overall spending trends and extracting the data that was previously used in the financial records of the company to study the trends. The trends and patterns of spending by the organization are varying from time to time and there is unpredictability given that the future ascertainment of the cost incurred is impossible to determine. The profits that are made by the company are subjected to payment of debts that are long-term and this makes it tp have a diminishing effect because the entity is not in a position to meet the targets and expectations that have been set during the drafting of the budget. Works cited Thomas. (1987). Report of the World Commission on Environment and Development. Sydney: Austria press. Anderson, D. (2006). "The critical importance of sustainability risk management journal of Risk Management. Vol. 53, no. 4. 234-345. Rennie, E. (2008). Growing Green, Boosting the bottom line with sustainable business practices." APICS Magazine. Vol. 18, no. 2. 345-456. Allan, T. (2001). Sustainable Business Movement in financial perspectives of companies. New York: American press.