Accounting & Auditing Updates

Types of intrinsic and extrinsic rewards Intrinsic rewards Are rewards that an employee enjoys through/when doing the job. These kinds of rewards Includes; 1.       Sense of Accomplishment 2.       Personal Growth Opportunities Extrinsic rewards Are rewards that an employee obtains as a results of the job done. These kinds of rewards Includes; 1.       Pay – reward after attaining certain best performance to an employee of an organization. 2.       Recognition – Formal or informal recognition. It can be a congratulation letter etc. 3.       Promotion – from junior level to a senior level. Salary may also increase in this aspect.

Intrinsic and extrinsic motivation Intrinsic motivation Is the situation where by an employee is motivated in job doing. When doing the job is inherently motivating Extrinsic motivation Other external factors are what motivate an employee. When rewards such as pay and formal recognition act as motivators.

Employee motivation Employee motivation means the force within employee that activates employee behavior within an organization.    Employee motivation is a function of three distinct components namely; Intensity, Direction, and Persistence. Intensity   Refers to the amount of mental and physical effort put forth by the salesperson. Direction The extent to which an individual determines and chooses efforts  focused on a particular goal. Persistence The extent to which the goal-directed effort is put forth over time.

LI M I T AT I ONS T O I N TER N AL CONTROL EF F ECTIVENE S S The   e f f e c t i v e n e ss   of   i n te r n a l   c ontrol   m a y   be   l i m i ted   due   to   a   num b e r   of   fa c tors   in   the o r g a nisation, includin g : 1.    W ea kn e ss in p rec ondi t ions to in t e rn a l c ontrol e f fec t i v e n e ss ( e . g . w ea k b o a rd memb e rs, a udit c om m i t te e , a nd p r o blems in str a te g ic p l a nnin g ). 2.    P e r c e pt i on of h i g h c ost i n maintaining c ontrols. 3.    Mana g e ment ov e r r ide o f e stablished p r o ce d u r e s. 4.    Col l usion a mong sta f f hen c e pr e v e nt i ng in te rn a l c h ec k.       5.    Control br ea kdown due t o e r r o r s, ca r e lessn e ss, d i s tr ac t i on e tc.

CO M P O NENTS A N D P RI N C I P LES OF INT E R N AL CONTROL I nt e rn a l c ontrol c o nsi s ts of five in t e r r e lat e d c om p on e nts a nd s e v e nt e e n p r i n c ip l e s that l i nk to a ll the four obje c t i v e s of in t e rn a l c ontrol (i. e . acc ountabil i t y , c omp l ian ce , op e r a t i ons, a nd s a fe g u a rding r e so u r c e s ) a nd a r e a ppl ic a ble a t a ll lev e ls of t h e o r g a n i s a t i on (i. e . o r g a nisatio n - lev e l, dep a rtme n t a l - lev e l, unit e tc). T a ble b e low p r e s e nts a sum m a r y o f the c ompon e nts and p r inciples of in t e r n a l cont r ol: C ompon e n ts a n d P r i nc i p l es o f I n t ern al Con t r o l ( C O S O , 2013) C o m po n e n t P r i n c i p l es 1.     C ont r o l en v i ro n m e n t : A s et o f s t and a r ds, p r oc e s s e s a nd s t r u c t u r es t h a t p r o v i d