Are there different kinds of internal control?
Internal controls can be classified as preventive or detective. Preventive controls discourage errors or irregularities: computer applications preventing invalid entries; reading and understanding University policies helps prevent violations; and a director’s review of purchases for validity prevents inappropriate expenditures. Detective controls identify an error or irregularity after it occurs: an exception report detects and lists incorrect or invalid entries or transactions; a comparison of validated cash receipts to the financial statement detects erroneous accounts; and the director’s review of long distance phone charges will detect abuse.
