Segregation of Duties - by Ravi Patel

 

An important internal control for companies is proper and adequatete segregation of duties in key risk areas.

 

When Entrepreneurs start out, there are fewer people in their organizations and proper segregation of duties is difficult. Entrepreneurs exercise greater oversight over all areas of the company to ensure internal control.

 

As their businesses grow, Entrepreneurs cannot and should not have too much oversight, but need to develop effective organizations with adequate internal controls with proper segregation of duties.

 

All key business processes need to be examined to review that no individual performs multiple duties such that there is a potential for malfeasence. Duties should be properly segregated to avoid such situations.

 

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