Identifying and Implementing the Proper Balance of Internal Controls

Overview

Internal Controls (IC) are in place for a reason. They help maintain the control environment and establish efficient and effective processes. They also serve as a mitigation technique for identifying when processes have changed and when procedures need to be adjusted. In today’s business world, all personnel must understand the concept of internal control, how they should be utilized and their benefits.

The purpose and value of internal controls are often misunderstood and misapplied by management. Internal controls should be viewed as a value-oriented activity that assists the organization in the effective execution of its objectives. Properly designed and executed controls are the key to ensuring this view.

A previous course “The Manager’s Responsibility for Internal Control," addressed these concepts at a higher level. This course further explores the types of ICs, how they can be properly utilized and the cost benefit considerations for implementation.

Internal control is a process designed to provide reasonable assurance regarding the achievement of objectives in the following areas:

• Effectiveness and efficiency of operations
• Reliability of financial reporting
• Compliance with applicable laws and regulations
• Safeguarding assets

Prerequisites

None

Objectives

• Explore basic concepts, myths and facts of Internal Controls (IC).
• Discover typical control types.
• Identify why controls fail.
• Identify a framework to develop the right balance of controls.
• Explore the differences between automated and manual controls and recognize the various testing processes

Highlights

• Introduction to identifying and implementing the proper balance of internal controls
• Concepts, myths and facts of internal controls
• Risks vs controls
• Typical control types
• Understanding controls and why they fail
• Framework for controls identification