It is the job of management consultants to analyze and evaluate whether a company's management is scientific, whether the organizational structure is reasonable, and whether the operations of various departments are efficient. Analyzing and evaluating whether a company's internal controls are reasonable and effective and conducting compliance testing are tasks that the company's internal audit agency or certified public accountant must do before starting a financial audit. The job of the legal specialist is to continuously improve and update the key internal control procedures of various departments of the company, and regularly pay attention to abnormal situations in the execution of these internal control procedures, and propose preventive and corrective measures.

The so-called internal control refers to the division of functions, management systems, work processes, etc. designed and formulated by the company in order to ensure legal and compliant operations, asset safety, effective management, and fair financial reporting, and executed by various functional departments. The general name for worksheet. The goal of the company's internal control is to ensure that the company's business activities comply with and comply with the requirements of laws, regulations and industry standard documents, ensure the safety of the company's assets, ensure that the company's management efficiency can be maximized, and achieve the goals of shareholders to the maximum extent, and Ensure that the various documents and reports submitted by the company to the outside world are reliable and accurate.

The legal department, the company’s internal audit department and the external certified public accountants have different focuses on internal control. The legal department pays more attention to the prevention of the company’s legal and operational risks through internal control, while the internal audit department focuses on the company. Whether internal control can protect the safety of the company's assets, CPAs focus on the impact of the company's internal control on the reliability of financial reports from the perspective of audit risk. Although the three have different focuses, they have the same purpose of improving company management efficiency and preventing legal risks in company operations through internal control.

The Legal Department’s attention and evaluation of the company’s internal controls are based on the following principles:

Whether the design of the internal controls complies with laws and regulations;

The internal Whether the design of the control is complete and has no major defects;

Whether the internal control is effectively implemented;

Whether relevant records are obtained and retained when executing the internal procedures;

When negotiating with customers, the sales department should save all customer authorization documents, qualification documents, inquiry materials, customer technical requirements, correspondence between the two parties, letters of intent, memorandums, official contracts, and supplementary agreements. , should keep the original copy of the fax document or the copy of the email in accordance with the work process. When receiving telephone consultations and complaints from customers, the phone records should be kept. When the sales department collects payment from the customer, it should keep the collection letter, copy of the email, and express delivery reply. Hold other documents.

Collaboration between the company’s legal department and legal advisors

The intention and purpose of setting up a company’s legal department focuses on the company’s internal control, while the purpose of hiring external legal advisors is

1) Hope to obtain independent and objective advice from legal advisors on specific matters;

2) Hope to obtain professional service support from legal advisors on a specific litigation or non-litigation case;

3) Provide professional guidance on the work of the company’s legal department.

Therefore, the legal department has the responsibility to assist the company’s legal counsel in business matters.

I sometimes chat with friends who work in the legal field online. Some of them are very dissatisfied with the company’s legal counsel. They feel that the company pays them tens of thousands or hundreds of thousands a year, but in fact the legal counsel Most of the work is done by them. Sometimes a case, from evidence to documents, is all compiled and drafted by the company's legal department. The legal consultant only appears in court once, but the company has to pay a large amount of consulting fees and legal fees. My advice to them is that their legal department establish a process for collaborating with corporate counsel. If the respective work responsibilities of the legal department and legal counsel and the collaborative relationship between them are not clearly defined, it will happen that either the legal department does nothing in the company's litigation activities and becomes a data copying machine, or they buy, cook, and When the food was served, the legal advisor became the invited guest. The quality of legal counsel's work determines whether the company benefits or suffers. When it comes to accountability, the legal department cannot escape the blame.

If you are a company's legal specialist, my suggestions regarding collaboration with legal advisors are:

1. Objectively evaluate the professional competence of legal advisors and make a report to the competent authority;

2. Maintain work communication with legal advisors and retain all working documents between them;

3. Actively assist legal advisors in their work, but maintain professional thinking and analyze.

The position of the legal department in the company

There is a way to make money. If there are many people to live and few to eat, if those who use it are sick and those who use it are comfortable, then the wealth will be sufficient.

---"The Doctrine of the Mean"

I quote the words from "The Doctrine of the Mean" as the beginning of this chapter, but you may feel that I am far off topic. In fact, for a profitable company or institution, maximizing shareholders' rights and interests is the company's business goal while ensuring the safety of its own assets. How to achieve this goal, I think this sentence from our ancestors is the guiding ideology. If you run a company with more money flowing in than money flowing out, and it is very efficient when creating wealth but slow when consuming resources, such a company will certainly be able to have "constant wealth." The problem is that many companies are still forging ahead and working hard day and night when they start a business. But when the first pot of gold was struck and the business was established, it became inefficient, the organization was bloated, the staff was overstaffed, the company had serious internal friction, and internal controls were lacking. Under numerous risks, it eventually went bankrupt and liquidated. This is in line with the old saying: "It flourishes vigorously, but its demise is sudden."

The company’s intention to set up a legal department

In newly established small and medium-sized companies, the production, technology, sales, and financial departments are usually the ones that the boss pays the most attention to. Because these departments can directly bring benefits to the company. Especially the managers or business backbones of the sales department, their responsibility is to convert the company's products into funds and let these funds flow back to the company. As a result, sales can easily get priority over any other department when it comes to allocating company resources. Other departments of the company, such as the administration department, purchasing and warehousing department, human resources department, information center, quality inspection department, board of directors' office, general manager's office, etc., are expense centers, compared with those arrogant warriors in the sales department. When meeting, the managers and supervisors of these departments will have a much lower tone. hehe. In fact, this is not a good phenomenon. A wise boss will balance the power of various departments in the company, and will not let any department dominate other departments or let employees at any level infringe on the authority of the boss. .

When the company's business reaches a certain level and the initial employees who started the business with the bosses are gradually faded out or marginalized, the bosses will re-examine the company's business processes and pay more attention to the aspects of business operations. Compliance and sustainability will put more emphasis on protecting and consolidating the results that have been achieved. Therefore, the bosses have enough reasons and the company has enough funds to support the establishment of a pure expense center-the legal affairs department. I am probably a person who likes to ask why. Therefore, I think that before applying for a company's legal affairs department, you should first understand why the company has set up a legal affairs department. It will help you to work in this department, and it will also help you to work in this department. Help broaden your career prospects with this company. In my opinion, the company CEO’s decision to establish a legal affairs department is mainly based on the following considerations: Avoiding and preventing legal risks in the company’s operations. The company has gradually transitioned from extensive operations to process-based operations. The external reason is that the company has completed the primitive accumulation of capital. The internal reason is that the company's decision-makers gradually realized that it is more difficult to maintain and start a business during the operation process.

For other behaviors that infringe on the company's interests, the legal department is responsible for conducting legal analysis and proposing handling opinions for reference by the decision-making department. The position of the legal department in the company. Whether the legal department is valued in the company superficially depends on its position in the company's organizational structure. In fact, it depends on the scope of authority delegated to the department by the decision-makers. . Therefore, when legal professionals from different companies chat together, they will find that even though they have the same positions and similar salaries, their status in the company is actually different. Some legal specialists will be "revered" by various departments in the company because they have the right to veto projects and the right to attend high-level decision-making meetings of the company. However, some legal specialists are the object of contempt by various departments. In addition to being constantly urged Make copies of the contract text, and call the sales department over and over again to collect bad debts that cannot be collected. The same position, with flames on one side and sea water on the other, haha. As far as I know, the legal department is set up in the following situations. Let’s take a look at the position of the legal department in different companies: Legal department (business functional department) under a horizontal structure. This is a more common way of setting up the legal department. . The legal department level under this organizational structure is parallel to the company's other business functional departments. Its department heads have the same rank and the same salary as the heads of other business departments. It may belong to a certain deputy general manager in charge of administrative human resources. The terms of reference are close to handling the day-to-day legal affairs of the company. The management intention of this structure is to position the legal department as a business function department responsible for the company's daily legal affairs management. This department is not responsible for the assessment of the company's legal risks, major legal decisions and recommendations, but it is responsible for executing or assisting in the execution of the company's decisions.

The flaw of this structure is that because the legal department is at a low level, it cannot effectively supervise and restrict other departments of the company. It has too much daily work and it is difficult for it to be involved in the company's major operational decisions. play a role.