i) Most internal controls tend to be directed at routine transactions rather than non- routine transactions. As a result it is important to ensure that where necessary the internal control procedures are adjusted to cover any non routine transactions. Rigidly adhering to the existing system could result in some transactions being carried out without appropriate controls.
ii) The potential for human error due to carelessness, distraction, mistakes of judgment and the misunderstanding of instructions. The possibility of this happening could increase where employees rigidly follow an existing system. This will undermine the effectiveness of the system
iii) The possibility that management procedures become inadequate due to changes in conditions and compliance with procedures may deteriorate. If the existing system is rigidly followed without reviewing the control procedures to ensure that they address the current circumstances then this will undermine the effectiveness of the system.