EFFECTUAL FINANCIAL ANDON-FINANCIAL INFORMATION FORDECISION-MAKING IN THE CONDITION OF RISK AND INSECURITY

Information and communication include accounting system. The accounting system, the manual and computer one, gives and communicates information for all the processes, methods and registrations of transactions of the economic unit. Communication means giving a clear understanding for the responsibilities of each person for inner control. This would include the reporting on a higher level within the entity, therefore the inner politics and outer financial reporting. Risk defining aims at identifying, calculating and managing the risk that could affect in the entity ability to achieve its main goals. When the risks are identified, the managing takes into consideration the meaning of risks, the opportunities and the ways of their managing. Managing can address specific risks or can decide to accept a risk because of the cost or other considerations. The risks may appear or change as a result of the environment changes, rules, operatives, personnel or information systems, fast growth and new technology, business lines, products or activities. The controlling activities are the politics and procedures that guide the actions of the employee to address the risks and to achieve the objectives of managing. The controlling activities include the realization of the duties and the controls on the process of information. The segmentation of the duties should create such conditions that no one should be in the position to make and to hide mistakes or irregularities in the normal flow of the process of gathering information or data. This means procedures for divided custody, authorization and account keeping. In the process of information, the auditor requires general controls, application controls to notice the exactness, fulfillment, authorization controls on the transactions and the controls of documentation. The inner controls have boundaries. Management can break them. If some workers make a hidden deal, they can escape the control. There exist also distortions of cost. At the end, the mistakes, including mistakes in judgment, can damage control.