Self Assessment of Internal Control
Fixed Asset Cycle
Self Assessment
of Internal Control Questionnaire
Objectives and Risks
Objectives |
Risks |
| All fixed asset transactions are initiated by authorized
individuals in accordance with established criteria. |
-Fictitious purchases or payments to contractors
or suppliers, with or without kickbacks to employees.
-Purchases from vendors whose interests are in conflict with
the organization.
-Purchases of unnecessary assets.
-Disposal or scrapping of serviceable assets.
-Purchases of assets which do not meet established quality standards. |
| Advance approval is obtained for all significant fixed
asset transactions. |
-Unauthorized purchases, construction contracts
or leases with companies or individuals related to executive or
legislative representatives.
-Purchases from related parties without the knowledge of senior
officials.
-Delay or cancellation of a project due.
-Expenditures in excess of originally approved amounts without
review and approval. |
| Adequate project cost records are maintained, and
in progress and completed project reports are issued. |
-Actual costs that exceed budgeted amounts.
-Overpayments to contractors.
-Misclassification of costs between capital and operating budgets. |
| All fixed assets are accurately recorded in detail
records which are compared with existing assets at reasonable intervals.
All fixed assets are adequately safeguarded. |
-Use of equipment or other assets for other than
the unit of government's benefit.
-Theft of tools and equipment, maintenance or supply parts.
-Payment of insurance on assets no longer owned.
-Unauthorized disposals of assets or diverted proceeds from sales
of assets.
-Physical loss of assets through inadequate security or insurance
coverage.
-Continued ownership of obsolete or otherwise nonproductive assets.
-Preparation of financial statements which do not accurately
reflect existing assets. |
| All fixed assets transactions are properly accumulated,
classified and summarized in the general ledger accounts as appropriate.
-A misstatement of reported financial position and results of operations. |
-Violations of loan covenants and/or rules and
regulations of various grantor agencies.
-Financial or operational decisions based upon erroneous information.
|
