Internal Controls Assessment
Ensuring the effective and efficient use of organizational resources through the application of appropriate tools and systems.
Level 1 Introductory: Demonstrates introductory understanding and ability and, with guidance, applies the competency in a few, simple situations. Can direct people to the appropriate source for further information.
BEHAVIORS
- Describes the cost and pricing structure of the organization and its products/services.
- Describes various methods of calculating product and service costs e.g. activity-based costing (ABC), job costing, process costing, direct and absorption costing.
- Explains the role of internal controls and the basic methods of achieving internal control.
QUESTIONS
- Describe a method of cost accounting you have used.
Probing Questions
* What was the cost method?
* When did you use it?
* Which costs were you accounting for? What are the advantages of using this cost method?
- Describe a time when your job required you to adhere to internal controls.
Probing Questions
* What were the circumstances surrounding this situation?
* What was the internal control you were faced with?
* What did you do?
* What was the result?
Level 2 Basic: Demonstrates basic knowledge and ability and, with guidance, can apply the competency in common situations that present limited difficulties.
BEHAVIORS
- Examines applied control procedures.
- Evaluates the effectiveness of control procedures.
- Gathers information about the control environment.
QUESTIONS
- Describe a time when you evaluated an internal control or control environment.
Probing Questions
* What were the circumstances surrounding this situation?
* How did you conduct your evaluation?
* How did you arrive at your conclusion?
* What was the result?
Level 3 Intermediate: Demonstrates solid knowledge and ability, and can apply the competency, with minimal or no guidance, in the full range of typical situations. Would require guidance to handle novel or more complex situations.
BEHAVIORS
- Analyzes the organization's cost systems to determine alignment with the value proposition.
- Evaluates whether appropriate information is being gathered and measured by existing performance management systems.
- Makes recommendations to support short- and long-term decisions, e.g. break-even, relevant cost, contribution margin, linear programming, sensitivity and uncertainty analyses, etc., based on appropriate cost analyses.
- Identifies opportunities for internal control improvements.
- Ensures that controls are operating efficiently.
- Uses control self- assessment techniques.
QUESTIONS
- Tell me about a time when you identified an opportunity for internal control improvement.
Probing Questions
* What was the circumstance?
* How did you identify the improvement opportunity?
* How did you arrive at your conclusion?
* What was the result?
- Describe a time when you determined that additional or alternative information was required to prepare appropriate performance measurements.
Probing Questions
* What was the situation?
* How did you determine that additional or alternate information was required?
* How did you communicate your recommendations?
* What was the result?
Level 4 Advanced: Demonstrates advanced knowledge and ability and can apply the competency in new or complex situations. Guides other professionals.
BEHAVIORS
- Evaluates organizational cost profitability management processes to ensure related operational activities support business objectives and value proposition.
- Establishes information requirements for decision making with respect to cost management.
- Develops and implements costing and pricing models and techniques e.g. ABC, TQM, Kaizen costing, value-based pricing.
- Monitors costs and revenues to achieve profitability goals.
- Acquainted with control techniques “preventive & detective”.
- Uses control self-assessment technique “CSA” to assess, evaluate and develop action plans.
QUESTIONS
- Can you describe a time when you developed a new or improved pricing or costing model?
Probing Questions
* What pricing or costing model were you using?
* How did you arrive at your decision?
* How did you implement the decision?
* What was the result?
- Tell me about a time when you utilized control self-assessment techniques.
Probing Questions
* What was the circumstance?
* How did you go about it?
* What was your conclusion?
* What was the result?
Level 5 Expert: Demonstrates expert knowledge and ability, and can apply the competency in the most complex situations. Develops new approaches, methods, or policies in the area. Is recognized as an expert, internally and/or externally.
BEHAVIORS
- Identifies opportunities for improvements in cost management to more effectively align costs with organizational objectives.
- Ensures adequate internal controls are in place to protect assets, to ensure the accuracy and completeness of reporting, and to maximize the organization’s value to stakeholders.
- Reports to external and internal stakeholders on the adequacy of internal controls and cost management.
QUESTIONS
- Can you describe a time when you identified a need for improvements in cost management?
Probing Questions
* What were the circumstances surrounding this situation?
* How did you identify the improvement opportunity?
* What was your recommendation?
* What was the result?
- Tell me about a time when you were required to report on internal controls to an external audience.
Probing Questions
* What were your role and responsibilities?
* What was the circumstance?
* How did you determine what information to disclose?
* How did you communicate the information?