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I got this a forward by email, I thought, I should share it with you…..

We already knew that working for Google had certain advantages, but, believe me, this giant of the search motor takes the welfare of its employees seriously …

as shown by this decompression (stress) capsule that is impermeable to sound and light …

Moving around: A slide allows quick access from different floors … There are also poles available … they are similar to the ones used in fire stations.

Food: Employees can eat all they want from a vast choice of food and drink.

INNOVATION: Large boards are available just about everywhere because “ideas don’t always come when seated in the office” says one of Google’s managers.

LEISURE: Pool tables, video games etc. are available in many areas.

Technical Support: Problem with your computer ? No problem … Bring it to this area where drinks are available while it is being fixed.

Health: Professional masseurs (eusses) available.

According to Wikipedia

Communication is the process of transferring information from a sender to a receiver with the use of a medium in which the communicated information is understood by both sender and receiver. Communication requires that all parties understand a common language that is exchanged.

I participate in virtual discussion forums and some of the members communicate using following sentences (they are grammatically correct).

• I beg to differ …. or I beg to disagree
• If you have queries, please contact the undersigned
• I hereby give my consent
• The undersigned does not carry any intentions to hurt you at all
• I beg you will consider the business well tonight and let me…

Source: ExtremeInstability

William Wordsworth’s (1770 - 1850) poem “Daffodils” is a very popular poem and often taught in schools. Most of us must have studied during the school days. It has following paragraph

The waves beside them danced; but they
Out-did the sparkling waves in glee:
A poet could not but be gay,
In such a jocund company:
I gazed–and gazed–but little thought
What wealth the show to me had brought:

The third line means happy. In today’s communication, you will be in trouble if you use it.

The point that I would like to make is one cannot use old English in today’s business communication as it may not be appropriate. The key is that your communication should be persuasive and should be to the point. (No ambiguity and without lawyer’s language).

The communication should be in active voice.

Eg.

• I am enclosing instead of …….. Please find enclosed
• Please contact me instead of …. If you have queries, please contact the undersigned ….
• I accept instead of ….. I hereby give my consent
• I am sorry instead of …. I beg your pardon
• Please apply .. instead of ….The interested may thereafter apply in a prescribed format with stamp and seal from appropriate authority. ….. The application form should have instructions how to fill it.

I have found few tips that should of interest to you.

• Email Etiquette
• Net Manners
• Apologies in Business Communication

Your comments please… I would be happy to read it on my blog.

Regards,

Santosh Puthran

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This is a guest post by Mr. V R Kedia B.com FICWA. He is a practising Cost & Management Accountant from Mumbai

Shape of the things to come

• Effect of LPG – Liberalisation, Privatisation, and Globalisation – Global competition, Fittest will survive, sub – optimal units have to die.

• Size, strong balance sheets and a history of achievements are no longer guarantees of continued success.

• Global competition – strategic alliance networks and massive engineering efforts place new demand on all professionals.

• Many of old hierarchies will be replaced by flat structures.

• Every organisation is undergoing a process of internal churning.

• Employees will be judged by their delivery of agreed output and level of services, not on spending 8 hours a day attending their place of work.

• Financial information will be considered as only one portion of the balanced scorecard of measures used in organisational decision making.

• Knowledge will replace physical and financial capital as an organisations primary resource.

• Knowledge and application of knowledge will create competitive advantage.

• People will have to be accustomed to work in permanent stage of emergency.

• More empowerment at the individual level.

• Adoption of team based organisation.

• Internet is rapidly transitioning businesses into real time.

Source: Megapixel

Present role of Management Accountants – Conceptions & Misconceptions

• Cost and Management accounting system had often become of little importance to managers. Many regarded them as minor routine belonging to the accountants, used to evaluate stocks and prepare monthly results speedily.

• There are all the obvious things to do: Statutory and Financial accounting, Taxation compliance, Funding, Management reporting and so on. All of this tends to be in the background; it just has to happen in any event. Management Accountants have not yet progressed more towards bridging the gap between managers and accountants and they have yet to concern more with looking towards the future – at where business is going and what is going to happen.

• Very few conceptual modifications have been brought in, in the cost and management accounting in the last 40 years.

• Cost is too important to be left to the cost and management accountant.

Futuristic role of Management Accountants

• Most of us will be doing the job, which we have never learnt and quite different from what we have been doing so far

• The illiterate of the 21^st century will not be those who cannot read and write, but those who cannot learn, unlearn and relearn.

• We have to undergo the process of “Learning, Un-learning and re-learning” more frequently.

• Industry will be requiring “learning” professional rather than “learned” professional.

• Future will be “knowledge era”. So obsolesce of knowledge will be very fast and more visible among accounting professionals.

• Management Accountant must re-orient its capabilities, otherwise he will be overtaken by other professionals.

• Management Accountant has to be futuristic instead of provider of historic or current information. He should ask “how better” and help management in decision-making level and for performance improvement.

• ‘Imagination is more important than knowledge’. – Albert Einstein.

• The responsibility of the management accountant is less on forecasting the future and more on contributing to its creation.

• Management Accountant will more often play the role of a catalyst / changing agent rather than an accountant.

• Management accountant will have to be more adaptable to be a versatile professional rather than an accounting specialist.

• Quality of “leadership” will be more in demand than that of a “manager” or an accountant.

• Out –cost ascertainment, product costing and cost control. In –cost management, activity-costing etc.

• Re-positioning of the management accountant – make it more relevant and useful to the organisation.

• Management accountant to change the “Accountant” from their name to information manager/Cost manager.

• Shift from “informational” role to an “influential” role.

• To develop alliance with- finance, MIS/IT, industrial engineering, corporate planning.

• To actively participate along with managers in decision making and strategy implementation.

• Change in mind-set from product profitability to customer profitability analysis.

• No more a scorer of the cricket match – but to be manager advisor to develop appropriate strategy to win the match.

• Management accountant needs to lead the effort in training managers to use accounting information along with balancing it with other key data sources.

• FOREX and Treasury function will be important profit centres.

Training needs

• “If you want to remain employed, you have to remain employable” – Jack Welch, CEO-GE.

• Dilemma for the management accountant will be to either change or cease to exist.

• Management accountant must learn fast, forget even faster and focus on winning.

• Management accountant requires very different skills from those that accountants needed to fill the narrow role that has been adopted by many finance professionals over the last three decades.

• Continuing Professional Education (CPE) programme be made compulsory by the institute for skill upgradation and aquiring the latest technology.

• Able to work well under pressure.

• Development of multi-disciplinary skill.

• Good communication skill – oral, written and presentation and a team player.

• Ability and drive to work against strict deadlines and targets.

• Ability to work with minimum supervision and a busy and dynamic work environment.

• Ability to prioritise multiple urgent tasks.

• Possessing good public relations skill.

• Adding a new skill to executive skill-set, every few years.

• To develop expertise in new ‘Green Field’ projects like-

• Infrastructure sector (Energy, Transport etc.)

• Information and Communication sector

• Service sector

• Agro based industries

Source: National Geographic

Changes in tools and techniques

• Target costing v/s. Historical costing.

• Life cycle costing.

• Activity Based Costing (ABC) – ABM.

• Total Cost Management (TCM)

• Business Process Re-engineering (BPR)

• Benchmarking.

• Kaizen costing.

• EVA / CVA

• Total Quality Management / ISO.

• Cycle time reduction (time compression).

• Supply chain management (SCM).

• Just in time (JIT).

• Elimination of dysfunctional activities.

• Out sourcing and co-sourcing activities.

• Defect prevention v/s. fault rectification.

• Zero Based budgeting.

• Traditional budgeting v/s. New budgeting (comparative Table enclosed).

• Full year budget exercise v/s reactive rolling forecast (computer generated budgets are obsolete the minute they are printed).

• Dis-continuity of time cycle – month end and year end- and to invent information system to handle multiple time horizons simultaneously.

• Radical change in IT/MIS e.g.

• Integrated database that meet the total business requirements (like ERP Software).

• MIS that is accessible and easy to use by all staff.

• Rich supply of information in the form of a variety of report.

• MIS for decision-making.

‘It is never safe to look into the future with eyes of fear’. – E. H. Harriman.

‘My interest is in the future, because I am going to spend the rest of my life there.’ –

C. F. Kettering.

You can contact Mr V R Kedia on +9193241 80717 or email vrkedia@vsnl.com

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13. Management Accountant Blog Home

This is part 3 and concluding part of Certification questions. Preparation for the SAP certification is quite daunting. The best sources is to read the training materials which is provided during the certification. You should read every line of it and any doubts test it in the system.

Take a test on this question

When entering a document using a foreign currency, which date is used to determine the exchange rate if the translation date is not entered ?(Single)

A. Posting date

B. Document date

C. Entry date

D. Baseline date

I got the answer wrong the first time. Write your answer. Check the solution at the end of the post.

Source: Pixadaus

Previous posts:

SAP FICO Questions - 1

SAP FICO Questions - 2

26. Choose the correct statements regarding recurring documents. (Multi)

A. When creating a recurring document, the valid time period must be defined.

B. The posting date is determined by either the run date or the run schedule.

C. Field values can be changed in recurring document.

D. After running the recurring document posting, the next run date cannot be displayed.

E. The original recurring document can be deleted from the batch input menu.

27. In manual bank statement customizing, you must (Multi)

A. Define an internal activity

B. Define a posting rule

C. Define a posting type

D. Define a currency

E. Define an account symbol

28. Which of the following statements about manual planning are correct?(Multi)

A. The planning type determines which bank accounts the plan amount to be inputted to.

B. The expiration date shows how long the payment advice is included in planning.

C. The payment advices for editing can be changed, archived, or reactivated.

D. Archived payment advices are included in planning till the value date.

E. The retention periods are determined by the bank account name.

29. Bank accounts should be controlled as follows when Cash Management is in use:(Multi)

A. Open items are managed for both the main bank account and the bank clearing account.

B. Both the main bank account and the bank clearing account permit line item displays.

C. The main bank account and the bank clearing account use the same sort key.

D. The value date in the field status string for both the main bank account and the bank clearing account must accept entry.

E. The cash-relevance flag in the master records for both the main bank account and the bank clearing account must be set.

30. Which of the following statements about creating customer master records are correct? (Multi)

A. An account group always gets assigned to a customer.

B. The company code is always a required entry.

C. The account number may be assigned by the user externally.

D. Information on each screen may be defined in configuration as mandatory, suppressed or optional, depending upon the account group.

E. Information on each screen may be defined in configuration as mandatory, suppressed or optional, depending upon the company code.

31. Which of the following statements are correct? (Multi)

A. A customer master is divided by client level and company code level.

B. In case of one-time customer you have to enter the customer’s address in the document itself.

C. Address, control data, and reconciliation account are included in the client level of the customer.

D. The most efficient way to create master records is to work with the external number range not internal number range.

32. Which of the following statements are correct? (Multi)

A. If a customer is also a vendor, the system can include outstanding Accounts Receivable invoice items in payment program.

B. If a customer is also a vendor, the system can include outstanding Accounts Payable invoice items when you clear incoming
payment receipts for the customer.

C. The reconciliation account defined on the customer master record is an account used to reconcile CO transactions back to FI.

D. All customer belonging to the same account group must be assigned to the same reconciliation account.

E. The alternative payer is used to transfer outstanding receivable item to the alternative payer’s account.

33. Bulk change of line item - this function allows you to change a whole group of line items simultaneously, instead of having to change individual items in the documents. What data can you change using this function?(Multi)

A. The reconciliation account

B. The company code

C. The payment terms and payment block

D. The house bank and payment method

34. Which of the following order types are internal orders?(Multi)

A. Result analysis orders for posting accrual costs in CO.

B. Capital investment orders for creating assets.

C. Maintenance orders.

D. Sales orders for make-to-order function

E. CO production orders.

35.Which of the following statements are correct regarding Internal Orders?(Single)

A. Planning transactions are allowed under any status.

B. Once an order has been released, only closing entries can be made.

C. Transactions can be allowed or disallowed depending in the
order status.

D. Additional order status categories can be created in the order master.

36.Which of the following statements is true about CO production orders?(Multi)

A. It is an internal order used to control production from a cost accounting point of view.

B. Bills of materials and routings are required.

C. It is not possible to post goods movements to and from the order.

D. You can post primary costs from Financial Accounting to the order.

E. You can post secondary costs from overhead calculation to the order.

37.Which statements are true regarding direct and indirect activity allocations? (Multi)

A. If both the amount of the activity used by the receiver and the total output activity quantity of the sender can be measured, then indirect activity allocation is used.

B. If the amount of activity consumed by the receiver is not measured, then indirect activity allocation is used.

C. Manual activity input planning cannot be performed if actual activities are allocated indirectly.

D. If direct activity allocation is used, the total output activity quantity is determined by summing all of the activity quantities allocated.

38. The primary cost element is one type of master data in Controlling. Before you can create a new primary cost element, certain prerequisites need to be fulfilled.

Which of the following conditions must be fulfilled BEFORE you can create primary cost elements?(Multi)

A. The controlling area must be defined.

B. The cost center must be defined.

C. The G/L account must be defined.

D. The plant must be in the system.

E. The business areas have been defined.

39. What is the difference between distribution and assessments? (Multi)

A. Distribution can be made for both planned and actual figures; assessments cannot.

B. Distributions can be made using statistical key figures; assessments cannot.

C. Distributions are used when the original cost information is necessary on the receiver; assessments are used when this information is not necessary on the receiver.

D. Distributions are made using the original primary cost elements; assessments are made using secondary cost elements.

You should remain calm and relaxed on the SAP Certification Examination. The examination will be computer based and will consist of singe as well as multiple choice questions. I had finished my answers in first one and hour of the examination but stayed there to check my answers again. I revised lot of my answers particularly the multiple choice ones. So it is a good idea to stay in the examination hall for allotted hours. The moment your time is up, you get the results.

The key to pass SAP certification is to read the SAP training documentation, try out the exercises and revise. You will pass the certifications. Good Luck.

The answer to the question

Q. When entering a document using a foreign currency, which date is used to determine the exchange rate if the translation date is not entered ?

A. B. Document Date

Any queries, please comment on the blog post.

Regards,

Santosh Puthran

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United Kingdom

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6. SAP FICO interview questions
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9. Management Accountant Blog Home

A general query by people who have experience in SAP.

• Can I appear for SAP Certification examination without undergoing the training program ?
• I have experience as end user of SAP, can I do SAP certification ?

The answer is available on SAP website on Examination Policies and Procedures.

Participants

• Partners and customers may register suitably qualified employees as candidates for the certification examination.
• Participants in training courses that are given by SAP or SAP’s authorized training partners and that include the certification examination may attempt the certification examination. For all Academy tracks that contain Case Studies, full participation of the student is mandatory to qualify to take the certification exam.

Source: Pandas that survived the China Earthquake

Previous Questions

13. Integration with MM: An asset purchase order is created in Purchasing. The goods receipt is posted on a value basis. Invoice verification then posts the invoice.

What is the name of the auxiliary account used for all of these transactions?(Single)

A. MM/FI clearing account.

B. GR/IR clearing account.

C. Asset purchasing clearing account.

D. Asset acquisition clearing account.

E. Vendor asset acquisition clearing account

14. What additional functions do asset classes offer?(Multi)

A. Specify required entry fields for asset master data
B. Enter default values for asset master data
C. Enter default values entries for depreciation area
D. Enter allowed entries for user fields
E. Define allowed company codes

15. Which of the following statements about manual depreciation (for example unplanned depreciation in FI-AA) area true?(Multi)

A. You cannot post manual depreciation in FI-AA.

B. Manual depreciation is posted immediately after entry(real time).

C. Manual depreciation is initially shown as a planned value after entry and only posted when the depreciation posting report is run.

D. Manual depreciation usually only applies to depreciation areas which you choose when you enter the document.

E. After entering manual depreciation in FI-AA., you also need to enter it manually in FI/CO.

16 .Which correspondence extracts all items in the chosen period from a customers account displays the balance carried forward balance and a closing balance of the Account ?(Single)

A. Payment advice

B. Payment notice

C. Account statement

D. Dunning notice

17. Which of the Following statements about automatic payment are correct ? (Multi)

A. In automatic payment procedures, all incoming invoices as of the second dunning level are paid automatically

B. Direct debiting or bank collection can be used in automatic payment procedures to clear customer invoices

C. Open items posted to G/L accounts can be cleared using the payment program

D. Special G/L transactions(down payment)can be posted using the payment program

E. The payment program can pay vendor invoices using wire transfers and checks

18. Imagine the following scenario:A company wants to execute a payment run on a daily basis and process several company codes at the same time. If the amount exceeds US$ 1000, the vendors are to be paid by bank transfer, amounts less than US$ 1000 are to be paid by check. The customer has two house banks and wants all checks to be processed by bank A and all (Multi)

A You store variants for print programs within customizing. Here you can specify that the information is to be output to a data carrier

B. You specify, per house bank, whether payments are to be made by check only or also by transfer

C. You specify the payment method from within the application,in the master record

D. The payment proposal of the automatic payment program can only be displayed

E. You can precisely schedule the print program from within the application

19. According to which criteria does the payment program determine and select open items (Single)

A. posting date and baseline date

B. document date and posting date

C. baseline date and payment terms

D. posting date and cash discount periods

E. posting date and payment terms

20. Which of the following statements are true with regard to the customizing setting for banks in the automatic payment run ? (Multi)

A. The sequence of the banks for processing outgoing payments is selected randomly

B. You can only determine one payment method per house bank

C. You can select several payment methods per country

D. You can specify by bank and method the anticipated number of days before the bank account is debited

E. You can determine the banks to be used for payments according to postal code

21. Which of the following factors does the systems take into account in a payment run ?(Multi)

A. Fiscal year variant

B. Payment method specifications in the IMG

C. Specifications in the vendor master records

D. Information in the documents(incoming invoices)

E. Specifications made when maintaining the payment run parameters

22. Which of the following statements are correct ?(Multi)

A. When creating a House bank, you do not need to specify the country.

B. The payments program can use a different House bank for each different payment method

C. A House bank account can be defined in more than one currency

D. House bank master data must be created in advance, before assigning the House bank to a payment method in the payment program
configuration

E. A house bank can be assigned to a business area within the payment program configuration

23. When entering a document using a foreign currency, which date is used to determine the exchange rate if the translation date is not entered ?(Single)

A. Posting date

B. Document date

C. Entry date

D. Baseline date

24. where are posting periods defined?(Multi)

A. Posting period variant.

B. Fiscal year variant.

C. Field status variant.

D. Closing period variant.

25. which of the following statements supports the reversal of a document?(Multi)

A. The original document contains no cleared line items.

B. Documents originating in other modules should be corrected there to allow the changes to flow naturally through to financial accounting.

C. If a reversal date is not specified, the system reverses the document using the posting date of the document to be reversed.

D. A new document number is created for the reversal document.

Part 3 and Concluding part next……

Please solve the certification questions. If any queries let me know.

Regards,

Santosh Puthran

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2. Nestle SAP implementation Year 2000
3. Forrester Wave - Report on SAP implementation provider
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6. SAP or Oracle - Which one should I do ?
7. How to Share Blog posts with friends
8. Management Accountant Blog Home

Many SAP FICO Consultants are keen on finding the certification question. I am including few of them on the Management Accountant Blog. You can give a try on the following questions. End users on SAP can test their knowledge about the system.

1. A chart of accounts ( Multi Choice)

A. can be allocated to multiple company code

B. can be defined as the group chart of accounts

C. only contains definitions for G/L accounts

D. can only allocated to one company code.

2. A client. ( Single Choice)

A. may only contain a single chart of accounts

B. may contain multiple charts of accounts

C. may only use one currency type

D. may only have one controlling area

3. Identify the correct statement(s) relating to how the main business processes are integrated in the SAP R/3 System. ( Multi Choice)

A. A purchase requisition is a documented request to purchase goods or services. In SAP it can be created manually or automatically.

B. A goods receipt is the recording of the movement of materials into the warehouse. In SAP, a financial document which updates the inventory account and an accrued liability account is created

C. The Invoice receipt and verification process compares the vendor invoice with the purchase order and goods receipt. However, the corresponding financial transaction must be entered through the financial module of R/3.

D. In SAP, payment processing reduces the liability to a vendor and a company’s cash balance, records discounts taken and disburses
payment.

E. A customer delivery is the transfer of the ownership of goods. A customer delivery includes, creation of a delivery document, picking the goods for shipment; physically transferring the goods to the customer and financially recording the goods issue.

4. Identify the correct statement(s) regarding organizational elements within the R/3 System. ( Multi Choice)

A. The Sales area combines the sales organization, distribution channel, and division.

B. The Purchasing Organization is responsible for the purchasing for the only one plant.

C. A plant is a location in which inventory quantities and values are stored or manufactured.

D. A Controlling area can comprise several company codes using different chart of accounts but must operate in the same currency.

E. A profit center is used to generate income statements and operating profit statements.

5. Which of the following statements is true ? ( Single Choice)

A. A Company code can belong to more than one controlling area.

B. A plant must be allocated to a company code

C. A controlling area and a company code must have the same local currency.

D. A business area and a company code are assigned to each other in the corporate structure IMG

6 . Which of the following statements about year-end closing are correct?(Multi)

A. You carry out year-end closing before the fiscal year change.

B. During year-end closing, the program checks if the year-end closing can be carried out.

C. Once the year-end closing was successfully completed, the system automatically changes certain entries in Customizing (closed fiscal year)

D. You cannot create and post to new fixed assets until The year-end closing is successfully completed

E. You can only conduct year-end closing on June 30 or December 31 of each year.

7. What steps have to be completed before you can generate asset classes form G/L accounts? (Multi)

A. Account selection

B. Account determinations

C. Number range intervals

D. Screen layout variants

E. Asset classes

8. For each depreciation area you need to specify whether you want to (Multi)

A. post depreciation at periodic intervals to the general ledger

B. post asset values at periodic intervals

C. automatically post values online

D. use index classes

E. post to business areas

9. Please click on the button next to the correct answer.(Multi)

A. The business area can run across many company codes, i.e. all company codes can post in all business areas.

B. A company code may belong to more than One Controlling Area.

C. Each company codes uses exactly one chart of accounts and one chart of depreciation.

D. Business areas are used to create internal balance sheets and income statements.

10. The time of the first acquisition posting to the asset sets the following fields in the master of asset(Multi)

A. the depreciation start date per depreciation area

B. the cost enter to be hit through depreciation

C. the date of capitalization

D. the depreciation key

11. Usually one Chart of Depreciation is defined for each country. At which level is the chart of Depreciation created?(Single)

A. at Company Code level

B. at Client level.

C. at Chart of accounts level.

D. at Business area level.

E. at System level.

12. What are the functions asset class?(Multi)

A. Asset number assignment.

B. Cost Center determination.

C. Screen layout

D. Account allocation

E. Definition of default value.

Regards,

Santosh Puthran

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The news article in Economic Times caught my attention where Indian CEOs prefer imported cars. The reason may be Indian auto makers may not have cars to suit the taste of super rich CEOs. I summarized the list from article for your dekko.

Mercedes is at the top of the list. Only Mr. Ratan Tata is in bit of odd position since his company is the leading Indian car manufacturer in India which focuses on car for masses. India Inc now expects car for classes too. According to Forbes in year 2007, India has 30 billionaires with total net worth of $ 152.30 billion.

Source: Maybach 62

It is customary for people working in Embassy and High Commission to drive cars of country origin. It would be interesting to see which cars Ambassador and representatives Indian High Commission drive ? Or will you consider cars Hyundai, Volkwagen, Suzuki manufactured in India to be an Indian car ?

Did you know that Malaysian car manufacturer Proton and Korean car manufacturer Hyundai has range of cars for all classes ? Tata Motors, buckle up, India Inc. expects a lot from you now. You have a Nano… now the expectation is for Macro also !!!

Just a closing thought ?

I have a friend who owns BMW and has been driving it for long time. When he sells the old one and buys another - it is always a BMW.

I asked him, why he doesn’t buy Mercedes ? He looked at me and said, “I don’t drive taxis !!! ” A view shared by most of BMW owners.

You will never find a BMW taxi but there will be always a Mercedes Taxi. Anyway, for the time being, I can only talk about it.

I will be happy to read your comments on this topic. Please add / post yours comments on which car do you fancy the most. What car does your CEO drive ?

Regards,

Santosh Puthran

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There has been a discussion in the cma_india yahoogroups the role of internal audit function in a company. One view was that the role of Internal Audit department has been reduced to vouching and checking the records and other view is that Internal function is Management Assurance Group.

According to Wikipedia

Internal auditing activity is primarily directed at improving internal control. Under the COSO Framework, internal control is broadly defined as a process, effected by an entity’s board of directors, management, and other personnel, designed to provide reasonable assurance regarding the achievement of objectives in the following internal control categories:

• Effectiveness and efficiency of operations.
• Reliability of financial reporting.
• Compliance with laws and regulations.

Management is responsible for internal control. Managers establish policies and processes to help the organization achieve specific objectives in each of these categories. Internal auditors perform audits to evaluate whether the policies and processes are designed and operating effectively and provide recommendations for improvement.

Internal auditing professional standards require the function to monitor and evaluate the effectiveness of the organization’s Risk management processes. Risk management relates to how an organization sets objectives, then identifies, analyzes, and responds to those risks that could potentially impact its ability to realize its objectives.

Source: Submit Archieve

I started my career in Internal Audit Department 15 years ago and was in the department for 5 years. We generated lot of internal audit report highlighting the areas of non-compliance or breach of internal control, revenue leakages, improvement areas and so on and so forth. The internal audit report were repetitive in the contents and management did not take the reports seriously.

The statutory auditors reported their reservations in the annual audit report that Internal Audit Department was inadequate as compared to size of the company.

Now I realize that the solution was not with internal audit department but with the management of the company who had to make investment in a good IT strategy. And a commitment to make process improvement that would help the business to be competitive with profit maximization or wealth generation for its stake holders.

The questions is

Should I make my career in Internal Audit ?

I would consider two or three years would be a good time to work in internal audit. You should always explore opportunities to audits different business units or line of business. Volunteer yourself for new work. This should help you to gain understanding of the business. I do not feel that people who have worked for 10 years in internal audit are good decision makers as far as business is concerned …. the reason is they have never involved in decision making process.

You should plan your career to work in to span in financial accounting, management accounting and other areas of business. I have seen that the companies are more interested in Management Accounting round the year than in Financial Accounting. Be genuinely interested in the business of the company, talk with people on the front-line / shop floor and at the top. This will help you sharpen you business skills and address the accounting and business issues. Who knows you will start your own business !!!

The scope of internal audit is limited to internal controls and system set by your company. If you like challenges, get out of it. You will be able to play an active role in business and improving it.

Share your thoughts by adding comments to this, I am more than happy to read and discuss.

Regards,

Santosh Puthran

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There has been a discussion in the cma_india yahoogroups the role of internal audit function in a company. One view was that the role of Internal Audit department has been reduced to vouching and checking the records and other view is that Internal function is Management Assurance Group.

According to Wikipedia

Internal auditing activity is primarily directed at improving internal control. Under the COSO Framework, internal control is broadly defined as a process, effected by an entity’s board of directors, management, and other personnel, designed to provide reasonable assurance regarding the achievement of objectives in the following internal control categories:

• Effectiveness and efficiency of operations.
• Reliability of financial reporting.
• Compliance with laws and regulations.

Management is responsible for internal control. Managers establish policies and processes to help the organization achieve specific objectives in each of these categories. Internal auditors perform audits to evaluate whether the policies and processes are designed and operating effectively and provide recommendations for improvement.

Internal auditing professional standards require the function to monitor and evaluate the effectiveness of the organization’s Risk management processes. Risk management relates to how an organization sets objectives, then identifies, analyzes, and responds to those risks that could potentially impact its ability to realize its objectives.

Source: Submit Archieve

I started my career in Internal Audit Department 15 years ago and was in the department for 5 years. We generated lot of internal audit report highlighting the areas of non-compliance or breach of internal control, revenue leakages, improvement areas and so on and so forth. The internal audit report were repetitive in the contents and management did not take the reports seriously.

The statutory auditors reported their reservations in the annual audit report that Internal Audit Department was inadequate as compared to size of the company.

Now I realize that the solution was not with internal audit department but with the management of the company who had to make investment in a good IT strategy. And a commitment to make process improvement that would help the business to be competitive with profit maximization or wealth generation for its stake holders.

The questions is

Should I make my career in Internal Audit ?

I would consider two or three years would be a good time to work in internal audit. You should always explore opportunities to audits different business units or line of business. Volunteer yourself for new work. This should help you to gain understanding of the business. I do not feel that people who have worked for 10 years in internal audit are good decision makers as far as business is concerned …. the reason is they have never involved in decision making process.

You should plan your career to work in to span in financial accounting, management accounting and other areas of business. I have seen that the companies are more interested in Management Accounting round the year than in Financial Accounting. Be genuinely interested in the business of the company, talk with people on the front-line / shop floor and at the top. This will help you sharpen you business skills and address the accounting and business issues. Who knows you will start your own business !!!

The scope of internal audit is limited to internal controls and system set by your company. If you like challenges, get out of it. You will be able to play an active role in business and improving it.

Share your thoughts by adding comments to this, I am more than happy to read and discuss.

Regards,

Santosh Puthran

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Worms reduce waster upto 80%, Google Advertising does the same for our marketing - Heather Gorringe, www.wigglywigglers.co.uk

There is a very good article “Cost and Management Accountant (CMA) – an Entrepreneur setting up practice as a CMA by Mr V R Kedia” published on the Management Accountant Journal of ICWAI. He has given useful tips on starting a practice and how to promote and build a network.

With the world on the Internet, you can get business if you have effective Internet presence and use Contextual advertising. A couple of tips:

1. Professional Website: Your firm’s should be a professionally looking website. It should give a details about your firm, contact information and updates on taxation / laws on the area that you practice. Anyone will be impressed when your information is up-to-date and receives a response when they contact you. Check with your Accounting Body about guidelines of the website. Master your firm’s website in 10 minutes on Accounting Web - Richard Sergeant has very good tips. Read more.
2. Contextual advertising: A contextual ad system scans the text of a Web site for keywords and returns ads to the Web page based on what the user is viewing, either through ads placed on the page or pop-up ads. For example, if the user is viewing a site about sports, and the site uses contextual advertising, the user might see ads for sports-related companies, such as memorabilia dealers or ticket sellers. Contextual advertising also is used by search engines to display ads on their search results pages based on what word(s) the users has searched for.

E.g. When you do a google search, you will notice sponsor ads that relates to your search . So advertising is key word targeted.

How it Google Adwords work: When you create an AdWords placement-targeted ad, you choose the exact Google Network content sites where your ad will run and specify the maximum amount that you are willing to pay for each click (CPC) or each thousand page views (CPM) on that site. You pay whenever someone views your ad. As with keyword-targeted ads, the AdWords Discounter automatically reduces the actual amount that you pay to the lowest cost needed for your ad to win the placement on that page.

Can you target a specific location ? The answer is “Yes”. The ads about your firm’s website will be displayed in a specific geography that you decide. So you do not spend an enormous amount on advertisement. Example of target advertisement. Click to enlarge the photo.

You can advertise on following websites:

Google Adwords , Kontera, Chitika Use one of them or similar to them that will drive traffic to your website and generate inquiries for you.

3. Social Networking: Professional social networking sites are Linkedin and Xing that are quite popular. You should use it extensively to network with other professionals. Participate in the discussion forums on topics of your practice and you will get noticed. This will build up your internet presence.

You want to search for Rajendra Patil who specializes on Activity Based Management.

• Rajendra Patil
• Rajendra Patil Activity Based Management

You find Rajendra Patil when you link him what he practises. Internet presence is very vital for the business.

I invite your views on this topic and discuss other ways of promoting your firm.

Regards,

Santosh Puthran

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