See attached file

Teaching Internal Control through Active Learning

EXHIBIT 1a

Student Preparation Instructions for In-class Team-based Competition

 

Student Instructions:

1. Read Chapter on Internal Control and become familiar with the Components of Internal Control that can be separated into the following categories below.

1. Establish clear lines of authority and responsibility

2. Segregation of duties (Recordkeeping/Custody/Authorization)

3. Hire Competent personnel

4. Maintain adequate records (including control numbers on documents)

5. Develop plans, budgets, and a system of independent review

6. Provide physical and electronic controls

 

2. Think about your work experience(s).

“Think evil”…Answer the question…”How could I steal from my company”.

 

If it is EASY to steal from your company, think about the following questions.

· Why is it easy to steal from your company?

· What is the weakness in the internal control system?

· What is the internal control principle that is weak?

 

If it is DIFFICULT to steal from your company, think about the following questions.

· Why is it difficult to steal from your company?

· What is the strength in the internal control system?

· What is the internal control principle that is strong?

 

NOTE: If you have no work experience, think of examples when something went wrong during your interaction with another company. An example might be when an airline lost your luggage; another might be the wrong amount was returned to you when you returned something to the store. Answer the question, “ What Went Wrong?” Provide 6 examples and try to link them to a principle of internal control.

3. Write about your work experience(s).

a. Complete Exhibit 1b – Exhibit 1b will be collected by your instructor as proof of preparation for the in-class team-based competition. It will be assigned points by your instructor based on level of effort and completeness. If you do not complete this form, you will receive NO credit for the competition.

b. Describe at least one example of each of the 6 internal control components listed above. These must be examples from a company you have worked for. On the sheet, name your company and describe your job. For each internal control principle, describe a work situation that illustrates the principle, and identify the situation as an example of weak or strong internal control, and why.

4. Be prepared for an in-class discussion of your experiences

 

 

EXHIBIT 1b-Student preparation form for in-class team-based competition

How Can I Steal from my Company?

Student name:
Company Name: Job Title:
Description of job:
1) Establish clear lines of authority and responsibility– identify the work situation representing an example of this principle

 

 

Weakness or Strength? WHY?

 

2) Segregation of duties (Recordkeeping/Custody/Authorization) – identify the work situation representing an example of this principle

 

 

Weakness or Strength? WHY?

 

3) Hire Competent personnel – identify the work situation representing an example of this principle

 

 

 

Weakness or Strength? WHY?

 

4) Maintain adequate records (including control numbers on documents)– identify the work situation representing an example of this principle

 

 

 

Weakness or Strength? WHY?

 

5) Develop plans, budgets, and a system of independent review- identify the work situation representing an example of this principle

 

 

Weakness or Strength? WHY?

 

6) Provide physical and electronic controls-identify the work situation representing an example of this principle

 

 

 

 

Weakness or Strength? WHY?

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