MCAA U4DB Initial

MCAA U4DB Initial
Student’s Name
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MCAA U4DB Initial
Maintaining an effective managerial control is critical in enhancing the quality of financial reporting in any particular organization (Gibson, 2012). Ideally, Bovar Company is encountering management control problems as a result of the integration of the various companies into a single company. The current problems are a result of the functional organization structure that the management in the company implements. It is advisable that the top management adopts a more effective strategy such as implementing a matrix organization structure in order to enhance the management control in the company. Furthermore, Bovar Company may face control risk due to the poor arrangement of the organizational structure. Ideally, control risks refer to the situation where misstatement of the financial statement may occur without being detected. It may be as a result of poor internal controls in the organization. For instance, the problems in the company including communication issues, cross-functional problems, and accountability challenges can propel the occurrence of control risks in Bovar Company. As an auditor assessing the control risks in Bovar Company, it is essential to evaluate the inter controls such as supervision, segregation of duties, and the aspect of authorization and approval (Moeller, 2014). Additionally, it is efficient to evaluate the internal audit of the company. Furthermore, every external auditor checks the strength or weakness of the internal controls in the organization while conducting the risk assessment process and in particular the reliability of the internal audit function.

For this reason, in developing effective corporate management controls in any particular company, it is essential to implement strong internal controls (Cascarino, 2013). More importantly, it is critical to develop a reliable and independent internal audit function in the company.
References
Cascarino, R. (2013). Corporate fraud and internal control workbook: A framework for prevention. Hoboken, N.J: John Wiley & Sons.
Gibson, Charles H. (2012). Financial Reporting and Analysis + Thomsonone Printed Access Card. South-Western Pub.
Moeller, R. R. (2014). Executive’s guide to COSO internal controls: Understanding and implementing the new framework. Hoboken, New Jersey : John Wiley and Sons, Inc.