Research showed that this Company had problems in corporate governance practices in relation to financial auditing and putting in place workable internal controls. To help in solving this problem, the company should form a Compliance Committee. This committee will be responsible for monitoring and enhancing the code of conduct therein. This committee will be responsible for making compliance training for all the employees. Compliance training will equip the employees with the necessary skills that will help employees to carry out proper internal controls in the finance sector.
In this committee there will also be the release of mandatory ethics of which the employees will have to adhere to. This code of ethics will help in prevention of behaviors that work to the detriment of the Company’s financial sector. Such behavior includes taking petty cash without proper accounting. This Company should carry out documenting formal, written policies and procedures governing the financial close process. This should include the implementation of formal monthly closing meetings with corporate and region accounting staff.
Such meeting will be very beneficial to iron out any problems before they progress. These policies and procedures properly implemented will help in solving problems that are related to internal controls in the financial sector. United Rentals as a Company should start implementing more formal account reconciliation and analysis processes. This should include the approval of review and approval requirements. These formal account reconciliation analysis processes will help to ensure that the internal controls in the finance sector are well functioning and will help seal any loopholes therein.
There are various solutions that can work for this Company in order to improve the internal controls in the finance sector that are a problem in this Company. One of the ways this can be solved is through implementation of more formal journal entries. These journal entries will help the accountants and other employees therein to monitor any transactions that will be carried out during the day, weak and month. This will ensure effectiveness in the internal controls.
The management in United Rentals should also ensure that there is proper documentation, review, approval requirements and related procedures. This will help in ensuring that journal entries are properly prepared with supporting documentation and have been appropriately approved. This approval should be done by the supervisors in charge of the financial sector in United Rentals Company. Among other solutions that United Rentals should put in place also includes upgrading of the corporate finance and accounting staff.
Once the staffs in an organization are not up graded, they always lead to detriment in internal controls in the finance sector of the organization. Upgrading will help eliminate this problem. United Rentals also needs to ensure that there is addition of several experienced financial personnel. Experienced personnel will enact control measures that are quite pragmatic therefore solving the problem of poor internal controls in the finance in this organization. These experienced personnel should mostly be the implemented at the
Vice President, Director and senior analyst levels in United Rentals Organization. Conclusion United Rentals Company was started in the year 1997. It deals with renting of equipment. It is the largest in the world. This Company has got strengths including having many branches. On of the main weaknesses is in its internal controls in the finance sector. There are also opportunities and threats that exist in United Rentals Company. There are many solutions that can be implemented in this Company to solve the problem of poor internal controls in the finance sector.
This includes upgrading of corporate and finance and accounting staff.
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