The unit can be applied across a variety of financial services sectors and has application to those job functions that have responsibility to conduct internal audits such as accountants and quality assurance managers.

FNSACC506A

Implement and maintain internal control procedures

ELEMENT

PERFORMANCE CRITERIA

1. Evaluate information systems

1.1. System specifications are evaluated against user requirements and feedback to identify redundancies and constraints, and capacities of information technology

1.2. Hardware and software needs are identified from assessment of available products and services

1.3. Possible uses and handling of accounting data are evaluated in consultation with users to determine security requirements

1.4. Organisational procedures and policies are analysed to evaluate scope of strategies for risk management, internal control of expenditure and compliance with statutory requirements

1.5. Enquiries regarding use of systems are monitored and recorded to ensure ongoing evaluation

2. Develop implementation plans

2.1. Principles, procedures and processes arising from internal control systems are examined to determine implementation issues relevant to organisational processes

2.2. Strengths and weaknesses of organisational processes, including present and future capacities, are analysed and incorporated in the implementation plan

2.3. Implementation is designed to cover outcomes, resource use, costs and the achievement and maintenance of professional accounting standards

2.4. Schedules are established that are realistic and feasible in the context of the organisation's short-term and long-term objectives

3. Review resource use

3.1. Sources of data input are monitored to identify influences and variations in returns and costs

3.2. Estimates of stock levels are monitored and reviewed to ensure appropriate stocking and ordering of materials and inventory items

3.3. Records of resource use are compared with unit cost estimates to evaluate projected costs

3.4. Factors influencing resource use in the future are analysed to assess impact on operations and objectives

4. Monitor plans

4.1. Implementation is adjusted to take account of emerging external influences and the establishment of alternative targets

4.2. Costs of plans are monitored and controlled by evaluating net benefits to operations from the allocation of resources

4.3. Internal control systems are adjusted to ensure the maintenance and achievement of accounting standards

Required skills

high level communication skills to:

determine and evaluate financial systems by consulting with staff on internal control procedures and using questioning and active listening as required

liaise with others, share information, listen and understand

use language and concepts appropriate to cultural differences

well-developed research and analysis skills for accessing and managing complex information

well-developed literacy skills for interpreting and analysing complex documentation including relevant legislation and producing audit reports

highly developed numeracy skills to accurately analyse, record and store data in accordance with organisational requirements and identify repeating errors and diagnose problems in financial recording

well-developed IT skills for accessing and using integrated financial systems, spreadsheets and databases and internet information

learning skills to maintain knowledge of changes to compliance legislation and requirements

problem solving skills to identify any issues that have the potential to impact on the organisation and to develop options to resolve these issues when they arise

organisational skills, including the ability to plan and sequence and timetable the introduction of new systems and processes

Required knowledge

ethical considerations for records and file management such as confidentiality

relevant financial legislation such as:

taxable transactions

reporting requirements

principles of internal control including statutory requirements

wide knowledge of recording and information management systems and software applicable to financial recording

The Evidence Guide provides advice on assessment and must be read in conjunction with the performance criteria, required skills and knowledge, range statement and the Assessment Guidelines for the Training Package.

Overview of assessment

Critical aspects for assessment and evidence required to demonstrate competency in this unit

Evidence of the ability to:

use internal control systems and meet organisational policies and procedures

apply professional accounting standards in identifying strengths and weakness within organisational policies and procedures

evaluate information systems

develop implementation plans

review resources and monitor plans.

Context of and specific resources for assessment

Assessment of performance requirements in this unit should be Assessment must ensure:

competency is demonstrated in the context of the financial services work environment and conditions specified in the range statement either in a relevant workplace or a closely simulated work environment

access to and the use of a range of common office equipment, technology, software and consumables

access to an integrated financial software system and data.

Method of assessment

A range of assessment methods should be used to assess practical skills and knowledge. The following examples, in combination, are appropriate for this unit:

evaluating an integrated activity which combines the elements of competency for the unit or a cluster of related units of competency

verbal or written questioning on underpinning knowledge and skills which may include formal examinations

setting and reviewing workplace projects and business simulations or scenarios

evaluating samples of work

accessing and validating third party reports.

Guidance information for assessment

The range statement relates to the unit of competency as a whole. It allows for different work environments and situations that may affect performance. Bold italicised wording, if used in the performance criteria, is detailed below. Essential operating conditions that may be present with training and assessment (depending on the work situation, needs of the candidate, accessibility of the item, and local industry and regional contexts) may also be included.

System specifications may include:

changing needs

client compatibilities

financial analysis functions

logical data models such as database design

networking capacities

processing capacities:

system size

speed

software:

upgrades

legacies

Security requirements may include:

data storage requirements

encrypted data

limited personnel access

passwords

read only files requirements

virus scanning.

Risk management strategies may include:

comparative analysis

decision making authorities

forecasting

periodic reporting

policy statements

quantification of risks.

Internal control systems and procedures may include:

accuracy in valuations

compliance testing

decision making authorities

identification, measurement and recording of:

income

assets

expenditure

liabilities

equity

risk management strategies

safeguarding and insurance of assets

transparency in financial reporting.

Strengths and weakness of organisational processes may include:

attitudes to change

compliance with internal procedures

computer literacy using skills profiles

decision making authorities

documented procedures

recording systems

work practices.

Implementation may include:

budgeting

consultation

documentation and guidelines

evaluation

feedback

staged introduction

testing.

Professional accounting standards may include:

Auditing Guidance Statements

Australian Accounting Standards

Australian Accounting Standards Board (AASB) requirements

Australian Auditing Standards

ethical requirements

Superannuation Industry (Supervision) (SIS) Act requirements.

Short-term and long-term objectives may include:

budgetary targets:

quarterly

half-yearly

annual

client development

investment realisations

monthly cash flows

profit growth

sales and revenues targets.

Sources of input data and documentation may include:

invoices

purchase orders

receipts

requisitions

system reports.

Unit sector

Accounting

This unit contains employability skills.