CHAPTER TWENTY SIXStandards of Internal Control for the Corporate Close and Consolidation Process

STANDARDS OF INTERNAL CONTROL 5: BALANCE SHEET CONSOLIDATION

Introduction: These standards of internal controls define the control objectives, risks, control assertions, control activity title, and frequency to ensure that good controls are in place for the consolidation of fiscal information for the balance sheet.

Control Objective Risks Control Assertion Control Activity Title Control Activity Frequency
  1. Ensure that all account activity has been captured in the balance sheet model.
 The balance sheet model is incorrect. Completeness Valuation or Allocation Comparison of Balance Sheet Model to Applicable Totals The accountant compares totals on the worksheet to the rounded totals on the balance sheet worksheets (presentations and SEC filings are rounded to $million to ease reporting) for both Assets and Liabilities/Shareholders' Equity, to ensure all ledger activity has been properly captured in the model. Monthly
  1. Ensure that all account activity and post-close adjustments have been captured in the balance sheet model.
 The balance sheet model is incorrect. Completeness Valuation or Allocation Comparison of Balance Sheet Model to Applicable Totals The accountant compares totals on the worksheet to the rounded totals on the balance sheet worksheets (presentations and SEC filings are rounded to $million to ease reporting) for both Assets and Liabilities/Shareholders' ...

Get The Fast Close Toolkit now with the O’Reilly learning platform.

O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.

Start your free trial