Final answer:
To effectively reconcile actual assets with accounting records, one should undertake reconciliation by periodically comparing a company's internal financial records with external statements. For example, balancing one's checkbook is an individual equivalent of this process. Governments address budget deficits by increasing public debt.
Step-by-step explanation:
An effective method of internal control is periodically comparing/reconciling actual assets with accounting records. The most straightforward way to accomplish this is through the process of reconciliation. Specifically, for businesses, this usually involves comparing the company's internal financial records against external statements, such as bank statements, to ensure accuracy. An example of this in everyday life is the practice of balancing your checkbook, which involves reviewing and verifying your own records of deposits, withdrawals, and balances against the monthly statements from your bank.
In terms of the self-check questions about government budget deficits, when governments run budget deficits, they typically make up the difference by increasing debt. This can involve borrowing from domestic or foreign investors, issuing government bonds, or utilizing other forms of public financing.
To check your understanding of these concepts, consider an event like receiving a paycheck which occurs regularly. Identifying the period (such as bi-weekly) and the frequency (e.g., every two weeks) of this event is an example of personal financial management similar to the reconciliation process used by businesses for internal control.