What Are Internal Controls in Accounting?
Internal controls are business processes that provide reasonable assurance regarding several key business objectives: that the business is operating efficiently, that reporting is reliable and that the business is in compliance with applicable regulations and internal procedures. Auditors rely on the system of internal controls when giving a favorable opinion to financial statements. In many cases, internal control is also an effective deterrent to employee fraud.
Related Questions
- Both the NYSE and the NASDAQ requirements for audit committee charters mention internal accounting controls. What exactly are these, and how can the audit committee oversee them?
- How does outsourcing the bookkeeping and accounting function improve my internal controls?
- What benefits result when business owners fine-tune their internal controls?
