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60- Production
Typical functions
Cost accounting
Manufacturing control
Inventory management
Property accounting
Common Seats
Depreciation and amortization of deferred costs, including property
Property withdrawal
Inventory transfer (from raw material to work in progress to finished product)
Manufacturing expenses absorbed
Variations, even waste.
Changes in the carrying amount of inventories, properties and other deferred costs
Vital forms and documents
Labor Cards
Material requests
Production or workshop orders
Movement tickets
Waste or waste tickets
Manufacturing Expense Types and Application Worksheets.
Authorization of inventory adjustments
Requests for capitalizable disbursements.
Usual Data Bases
Property master file (dynamic)
Product master file (reference)
- Cost information Material relationships Routing sheets
Account amortization analysis (dynamic)
Normal Links
Inputs of material and labor of the acquisition and payment cycle.
Product shipments to the entry cycle
Activity summaries (journal entries) to the financial reporting cycle.
4.4 INCOME
Typical Functions
Granting of credit
Order entry
Delivery or shipment
Billing.
Accounting for commissions
Collateral accounting
Accounts receivable
Cash income
Collection (eg, arrears collection management)
Invoice adjustments
Sales costing
Common Seats
Sales
Costs of sale
Cash Income
Returns and on sales
Discounts for prompt payment
Provisions for doubtful accounts
Cancellations (write-offs) and recoveries of canceled accounts
Commission expenses
Sales tax liability
Accumulation of warranty expenses
Vital forms and documents
Customer orders
Sales or shipping orders
Bills of lading
Sales invoices
Remittance notices to clients
Forms for customer adjustments
Usual databases
Reference
Customer and credit master files
Product catalogs and price lists or files
Dynamics
Pending orders archive
Detail of accounts receivable
Analysis archive and sales history
Normal Links
Cash income to the treasury cycle
Shipments of products of the conversion cycle.
Activity summaries (journal entry) to the financial reporting cycle.
4.5 FINANCIAL
Typical Functions
Passes to the general major
Obtaining data for supplementary exposures
Preparation of journal entries (if not done in other cycles)
Consolidation
Converting data into another currency
Report preparation
Financial record retention
Common Seats
Valuation (If not prepared in other cycles)
Eliminations
Reclassifications
Vital forms and documents
Journal entries
Financial statements and other reports
Usual Data Bases
Reference
Account classification
Budgets
Currency exchange rates
Dynamics
Major general
Auxiliary majors
Normal Links
Journal entries from other cycles
Reports to the financial planning and control function
Common Reports
Trial balances
Balance sheets and profit and loss statements
Reports by responsibilities
Profit and loss report by divisions or other sections
Statements of movement of cash and of origin and application of funds
Income tax returns.
The main aspects of payroll control are:
Staff hiring
Time control
Preparation and posting of payroll
Payment distribution (Check or cash)
Personal control
Analysis of implanted systems
Techniques and means of motivation
Work environment
Union relations
Regulations
Employment contracts
Job analysis
Training and education programs
Organization
Application case
The following areas of the Human Resources Department are established in a company. Obtain the respective approaches to each of these areas and the associated microprocesses
The established areas are:
1.- Services
2.- Legal Benefits
3.- Social Work
4.- Control
5.- Industrial Safety and Hygiene
The attention focuses of each area are:
- SERVICES
1.- Loan
2.- Advance
3.- Medical Insurance
4.- Food
5.- Training
6.- Contracted Express
8.- Benefits to the IESS
- LEGAL BENEFITS
1.- Holidays
2.- Commissary
3.- Social Benefits (IESS)
3.1 Unsecured Loan
3.2 Withdrawal from the Reserve Fund of Active Personnel
3.3 Return of the Losing Personal Reserve Fund
3.4 IESS retirement
3.5 Unemployment Insurance
4.- Payment of the Thirteenth Salary
5.- Payment of the Fourteenth Salary
6.- Payment of utilities
7.- Payment of salary component
8.- Business Contributions to the IESS
8.1 Reserve Fund Deposit
8.1.1 Active Personnel
8.1.2 Dismissed Personnel
8.2 Payment of personal and employer contributions
- SOCIAL WORK
1.- Permission
2.- Medical License
3.- Work accident
4.- Events
CONTROL
Personal control
1.- Personnel Selection
2.- Hiring
2.1 Stable
2.2 Eventual
3.- Evaluation of personnel in probationary period
4.- Transfer of personnel
5.- Change of position
6.- Interdepartmental change
7.- Disciplinary sanctions
Activity control
1.- Card holder
2.- Settlement of assets
Expense Control
1.- Travel Expenses
2.- Route
3.- Payment role
4.- Payment of Income Tax
5.- Payment to the Juvenile Court
6.- Account Analysis
7.- Salary Leveling
8.- IESS Certificate
SAFETY AND INDUSTRIAL HYGIENE
1.- Comprehensive Security
2.- Industrial Hygiene
3.- Uniforms and security implements
4.- Medical Attention in Local Dispensary
As we can see, these surveyed criteria identify a general structure of the Human Resources area of some companies
Other Payroll and personnel control approaches are detailed below
Typical functions
Select staff
Analyze labor relations
Make attendance records
Payroll accounting
Disburse payroll
Common seats
Processes
Cash Management
Cash control
Control Schemes
Cash Disbursements
Cash Replacement
Cash register
4.8 INVENTORY
Process: Warehouse and Inventory Management
Activities
Product Storage
Product Coding
Inventory classification
Inventory loss
Budget control of materials
Physical Inventory Taking
Prepare Orders
Product receipt
Products Dispatch
Return of products
Transfers between warehouses
4.9 Control Schemes
Control must be present in the processes, activities and tasks. The schemes are varied from policies, rules, laws and regulations, to prevention signs, letters, inspectors, supervisors, automatic system or process controls.
Control schemes must be implemented in the main processes of an organization, that is, in the:
Shopping function
Receive function
Storage function
Distribution function
Production function (In the case of conversion processes)
Shopping function
The purchasing process begins with a purchase request or order, which must be approved by the storage department or another department that needs said goods or services. A copy of the request is sent to the purchasing department in order to prepare the duly numbered purchase order.
In some large companies purchase orders are issued, only if other procedures are fulfilled, such as: determining the need for the item, obtaining competitive offers, obtaining approval of the financial aspect.
Copies of the purchase order should be sent to the Accounting and reception departments.
The purchase order can be made by telephone by the buyer, but must be formally prepared and sent.
Receive function
All goods received, without exception, must be entered into the company through the reception department, which is independent from the purchasing, storage and dispatch departments.
The reception department executes some activities and / or tasks, including:
Check quantities of goods received
Detect damaged or defective merchandise
Prepare input reports
Transmits / sends received goods to warehousing department
Storage function
As goods are shipped to warehouses, they must be counted, inspected, and reported as received.
The storage department notifies the accounting department of the amount received that is entered and put into stock
The storage department signs as responsible for the custody of the goods during their storage time.
Distribution function
Please review the following cases and identify any errors and / or weaknesses that have been found.
1.- A cashier does not register cash sales and steals it.
2.- An accounting assistant accidentally omits the recording of the day's entries from a register.
3.- A teller misappropriates cash payments from customers on documents receivable, by not accounting for entries in customer accounts
4.- An accounting assistant does not accidentally record the payment of a document receivable
5.- An accounting assistant prepares a check for himself and accounts it as if it had been drawn on a supplier
6.- When an invoice is received from a supplier, a purchase is recorded and it is registered again when the supplier sends a duplicate of the invoice
7.- An accounting assistant prepares a check in your name and records it as if it had been issued to a large supplier
8.- A disbursement is made to pay an invoice for goods that have not been received
9.- The goods are ordered but shipped to an inappropriate address and are stolen.
10.- A purchase is registered when an invoice is received from a supplier, and it is registered again when the supplier sends a duplicate invoice.
CASES WITH SOLUTION:
1.- A cashier does not register cash sales and steals it.
- Inadequate supervision of tellers Clients are not encouraged to obtain receipts for cash payment
2.- An accounting assistant accidentally omits the recording of the day's entries from a register.
- Inadequate controls to reconcile cash register tapes and accounting records Inadequate controls to reconcile bank accounts
3.- A teller misappropriates cash payments from customers on documents receivable, by not accounting for entries in customer accounts
- Lack of separation of duties between staff who have access to cash inflows and those who make entries in accounts receivable records
4.- An accounting assistant does not accidentally record the payment of a document receivable
- Inadequate reconciliations of the auxiliary records of accounts receivable with the control account of the general ledger.
5.- An accounting assistant prepares a check for himself and accounts it as if it had been drawn on a supplier
- Inadequate separation of duties and functions. The person who signs the checks does not review or cancel the supporting documents
6.- When an invoice is received from a supplier, a purchase is recorded and it is registered again when the supplier sends a duplicate of the invoice
- Ineffective controls in the review and cancellation of supporting documents by the person signing the check.
7.- An accounting assistant prepares a check in your name and records it as if it had been issued to a large supplier
- Inadequate separation of duties between accounting and preparation of cash disbursements The person signing the checks does not review or cancel the supporting documents
8.- A disbursement is made to pay an invoice for goods that have not been received
- Ineffective controls to associate invoices with entry documents before authorizing disbursements.
9.- The goods are ordered but shipped to an inappropriate address and are stolen.
- Ineffective controls to associate invoices with input documents, prior to authorizing disbursements.
10.- A purchase is registered when an invoice is received from a supplier, and it is registered again when the supplier sends a duplicate invoice.
- Ineffective controls for the review and cancellation of supporting documents by the person signing the checks.
4.10 PROCESS IMPROVEMENT
Process improvement begins with a team of collaborators who meet to develop a flow chart that will graphically represent the different steps in the process. Too often, just a visual analysis reveals sources of waste that can be corrected immediately: downtime, redundant paperwork, unnecessary material movements, and ineffective inspections.
The analysis of the process is based on another important premise: Each step either contributes to the value of the product or contributes to waste. There are no other alternatives and if a step contributes to waste it must be eliminated immediately, because logically it is increasing costs, and it is reducing the company's profits each time that step is repeated.
It is important to take these criteria into account in order to make recommendations in the processes and promote their continuous improvement.
5 BIBLIOGRAPHY
Administrative Audit, Leonard William, Editorial Diana, Mexico
Administrative Audit, EF Norbeck, Technical Editor, Mexico
Practical Applications of PERT and CPM, Lui Yu Chen-ao, Editorial Deusto Bilbao - Spain
Contemporary Audit, Boutell, Accounting and Administrative Editions, Mexico
Budget Control Practice, Marcel Moisson, Editorial Deusto Bilbao - Spain
Zero Base Budget, Pyhrr Peter A., Editorial Limusa México
Principles and Applications of Management Control, P. Simeray, Editorial Deusto Bilbao - Spain
Administrative Audit, JA Fernández Arena, Editorial Diana México
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