Index IntroductionTypes of Internal ControlRecommendationsIntroductionThis document will discuss internal controls in business, inappropriate cash procedures, and inappropriate inventory procedures and conclude with recommendations. The purpose of internal controls is to create an environment in which errors have a low probability of occurring and cases of dishonesty are easily identifiable. Although some internal control principles seem like simple common sense, those who have ignored them at some point can confess what it has cost them. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get Original Essay Anderson (2008) argues that this is a process implemented by the board of directors and management of a company, and is put in place to provide reasonable assurance of the effectiveness and efficiency of operation in the corporate reliability of the reporting, in compliance with the rules, laws and regulations governed by GAAP, FASB and GASP. Environmental control, risk assessment, control procedures, monitoring of all of the above (the overall system) are the five key elements of implementing internal control. The role of internal control is mainly to protect a company from malicious acts such as fraud and give the company a chance to comply with accounting principles considered appropriate and called Generally Accepted Accounting Principles (GAAP). These issues protect the company from fraud, collusion and criminal harm. Internal control generally helps inform management about inconsistencies, poor production, and inadequate production of both personnel and equipment. Types of Internal Control According to Anderson (2008), there are three types of internal control which include; investigative checks aimed at identifying irregularities and errors that may have occurred. The second concerns corrective controls, designed to correct errors and irregularities that could have been detected, while the last concerns preventive controls, designed to prevent errors or irregularities from occurring. For example, internal controls encourage strong promotions that produce high-quality goods and services at the lowest possible cost. This is achieved by limiting excessive inventories, high-content equipment and excessive utilities. Operating costs should be kept within a reasonable budget. One of the poor cashier procedures in this industry is the collection of daily receipts by whoever is available. Not everyone is trustworthy and cash on hand is very tempting. B. Pitt, the entrepreneur, could appoint a trusted person to receive this money and to collect it in order to account for any losses. Another inappropriate cash flow procedure is for a prospective carer to withdraw money from the cash register to pay for small expenses such as milk and stationery. You can steal and deny having spent the money on these small expenses. The third is the lack of baggage screening of staff to ensure security is maintained; this will encourage theft as these staff members will always know that no one bothers to check their bags when they leave work. B. Pitt should ensure restrictions on access to petty cash; keep cash transactions to a minimum and keep incoming money separate from paid out money (Rezaee 2002). Inventory management is crucial in any business. If poor inventory procedures are used in a business, it is doomed to fail and profitability can easily be eroded. Some of the.