It will indicate where controls are necessary. Departments should review their operations and identify areas of inherent risk and vulnerability. Areas of inherent risk are those activities with potential for loss from fraud, waste, unauthorized use, or misappropriation due to the activity's nature. Thus, to implement internal controls efficiently and effectively, departments must evaluate the levels of risk for each of their areas and activities. Once these have been evaluated, appropriate levels of control can be established in response to the assessed levels of risk.
Some assets are immediately negotiable or easily converted to cash.
Thus, special attention should be paid to cash and convertible assets. B. Internal Control Plans Must Be Documented Each department must maintain detailed written documentation of its internal control plan. Chapter 647 requires that a written plan of controls be established and updated at least annually. The plan must be made readily available upon request to all pertinent personnel, auditors, and the representatives of the Office of the Comptroller and the Executive Office of Administration and Finance. Written documentation is necessary to clearly communicate specific responsibilities and to enable internal control review and evaluation.