Audit and Internal Control for Citigroup, Inc.

Internal Controls and Audit Case Study
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Internal Controls and Audit Case Study
Audit and internal controls are significant for determining organizational success. Most accountants confuse audit and internal controls. Internal controls are procedures, rules, and mechanisms that a company uses to promote financial integrity and accounting information (Cangemi, 2016). The main aim is to prevent fraud and promote accountability. An audit is an unbiased examination of financial information conducted by an independent body. Internal controls and audits allow organizations to identify financial weaknesses. However, many issues are associated with internal controls and audits. The paper critiques Citigroup's internal controls and provides a reliable sustainability recommendation.
Citigroup's Internal Controls
Citigroup serves as a financial service company. Citigroup has critical consideration with its internal controls. Banamex implemented the account receivable factoring qualities but did not segregate the balance system and checks (Citigroup, 2018). Secondly, there was a critical failure in vetting OSA, an example of operational control deficiency. OSA could be allocated the credit after critical scrutiny based on the accounting principles due to red flags seen. Lastly, Citigroup's internal controls are ineffective since there is poor communication; for instance, there is no adequate financial communication between ICG and CCB. Therefore, the company's internal controls have numerous gaps that must be sealed. The purpose of its internal control is to promote financial stability.
Design and Operation Control Deficiency
Design and operation control deficiencies are unique from each other. An operation control deficiency occurs when the operation does not allow the employees and management to perform the normal financial functions leading to misstatement (Dickins & Fay, 2017). An example in the case study is the failure to vet OSA and understand creditworthiness. On the other hand, design control efficiency is associated with poor design or missing control for meeting specif...