Ethics

Internal Controls
Name
Institutional Affiliation
Each business needs to come up with systems that enable the organization to function in an effective manner. Internal controls are part of most companies and are geared towards ensuring the organizational processes are conducted as per the prescribed style. In the scenario under consideration, the manager trusted the employee to a large extent and overlooked the need for internal controls. The employee was allowed to conduct all activities relating to cash and back such as collecting cash, reconciling statements and preparing the bills. A manager needs to ensure that there is segregation of duties because no employee handles more than one activity in a single transaction.
The manager should also undertake activities geared towards error detection and documentation of weaknesses. This would ensure that internal control systems are modeled to deal with such issues. Managers also need to focus on continuous monitoring of the internal controls. This aids in the easy identification of areas that may cause problems (Walsh, 2009). The concept of audit scrutiny is brought into play since the management needs to go through the auditing processes and the opinions so as to establish internal structures that serve the business efficiently (Eaton & Tansey, 2004). The changes in the business environment need to be considered, and the managers should ensure the internal controls are adaptable.
I believe the internal controls that I have used at the current time are defective.

The employee should not be allowed to undertake all activities relating to cash and bank. The internal controls that I have recommended are effective and will help the organization stop further losses (Bostrom, 2004). They will ensure mistakes are realized at an early and corrective action can be taken. I believe that my attitude as a manager towards the employees should change such that I do not form a close relationship that clouds the concepts of hierarchy and responsibility.
References
Bostrom, R. (2004). Compliance, risk management and internal controls. International Financial Law Review, 91-95.
Eaton, R., & Tansey, J. (2004). EVOLUTION IN THE ROLE OF INTERNAL CONTROL. Journal of Accounting & Finance Research, 12(4), 145-149.
Walsh, M. (2009). Getting Project Manager “Buy in” for Internal Controls. Armed Forces Comptroller, 24-27.