FINANCIAL AND CYBER SECURITY CONTROL

 

This will be discussed in these areas

 

-   -Accounting records.

- -  Financial control and authorisation. 

   -Budget & budgetary controls.

    -Cyber security. 

    -Data security 

    -Security of data in the cloud. 

 

The main law in economics is the law of scarcity.

Resources are scarce but human wants are unlimited. 

There must be a way to control resources within and out of the business. 

 

ACCOUNTING RECORDS 

 

(a)Sales or Revenue-this track income to the business with dates

 

(b)Purchases-This track all purchases made in the business with dates. 

 

(c)Inventory or stock records. 

 

(d) Cost of production or services per period. 

 

(e) Creditor or accounts payables. –keeps track of bill or creditors to pay.

 

(f) Debtors or Accounts Receivables –keeps records fund to receive from debtors.

 

(g) Fixed or non-current Assets employed in the business. 

 

(h) Capital and fund employed in the business. 

 

(i) Bank reconciliation statement. 

 

As business starts growing these records moves from manual to more sophisticated computerised system.

 

Financial control & authorisation level.

Controls is more valuable than audit as prevention of ailment is more valuable than cure.

Controls prevent adverse consequences. Therefore, it is necessary that controls are structured to prevent adverse result.

There should be check and balances to ensure that resources are protected from theft and wastage.

SOME WAYS TO ACHIEVE THESE ARE AS FOLLOWS.

1.     Separation of authorisation from payments and executions of programs and contract.

2.     Regular checks to ensure that fund are properly used.

3.     Regular checks to ensure that all fund collected from customer are

Being remitted to company account.

4.     Ensure that only approved payment and expenditure passed through the bank accounts.

5.     Monitoring the security of the company fixed asset and movement of stock.

 

 BUDGET.

 Financial budget is necessary to control cost and expenditures. It force the organisation to spend within their limit

 

 

 

 

 

 

 

 

CYBER CONTROL & SECURITY

Often all the process discussed above are done with the use of computer.

Some control are discussed below.

1. System design documentation.

2. Use of password and regular change.

3. Regular backup of data.

4. Firewalls and antivirus.

5. Encrypt of organisational data.

6. Control of physical assets/computers.

7. Getting licence and support from reputable and authorised dealers.

8. Human controls- integrity of staff, qualifications and authorisation.

9. Test the system vulnerability to hacking.

10. IT policy specified and signed by all staff.

11. Protect the safety of information saved in the cloud.

12. Innovate and research on new IT controls since IT changes.

13. Training.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MANAGING CASH FOW RISK.

 

Cash flow risk can be discussed in these four areas.

 

§  Cash risk tolerance level’

§  Cash flow budget

§  Cash flow management.

§  Management of cash payment risk.

 

You cannot operate effectively and efficiently without cash. The way you manage cash can make a big difference.

 

‘CASH RISK TOLERANCE LEVEL’- ‘SET A CASH BALANCE MINIMUM LEVEL’.

 

This level is the minimum level below the business cannot succeed.

Set your risk strategy.

 

Without risk –no return. Use of cash involves risk. You can succeed even if you take high risk.

 

Depending how you manage your risk. Some have several line of business and can take high risk in one line and take low risk in another line .This balances overall risk taking.

 

CASH FLOW BUDGET:  Is very important that business develop cash flow expressed in time period. This means expected fund inflow and outflow.

It can be expressed in month, quarter or yearly which can be reviewed occasionally.

 

CASH FLOW MANAGEMENT.

 

PSYCHOLOGY OF CASH FLOW: When you maintain some levels of cash balances. It gives your business some element of ‘psychological business security’.

 

 

 

MANAGEMENT OF CASH PAYMENT.

 

Honouring cash payment contracts build business integrity. Spreading payment that would have been done once can help a business to maintain a good cash position while matching their cash inflows.

 

Disclaimer: Obi Azubuike is not by this publication acting as a professional advisers and therefore not liable to any  damage whatsoever for your acting or refraining to act based on  this publication. Consult your professional for advice.