Insurance/finance

How Internal Control Works For Your Business

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How Internal Control Works For Your Business

How Internal Control Works For Your Business

How Internal Control Works: Internal control and your business should work hand in hand to achieve set goals and that’s what every business owner wants.

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Internal control is broadly defined as a process, effected by an entity’s board of directors, management and other personnel, designed to provide reasonable assurance regarding the achievement of objectives in the following categories:

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1. Effectiveness and efficiency of operations.
2. Reliability of financial reporting.
3. Compliance with applicable laws and regulations.

It can also be defined as a process for assuring achievement of an organization’s objectives in an operational effectiveness and efficiency manner.

What internal control can do:

1. It can help a business achieve it performance and profitability target.

2. It can help reduce waste of resources

3. It can ensure reliable financial report

4. It can help avoid damage to a business reputation and

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5. It ensures compliance with laws and regulations.

What internal control can not do:

1. It can not change an inherently poor manager to a good one.

2. It can not avoid actions of competitions

3. It can not stop change in government policies

4. It can be circumvented by collusion of two or more staff

5. Management can override the internal control system.

source: COSO

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Originally posted 2022-09-02 17:27:19.

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androidpurse

My Name is Joshua Mercy. I am a content writer and a tech enthusiast who loves to research and give valuable information in order to help people get what the want and need.

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