Page 156 - SBL Integrated Workbook STUDENT 2018

Chapter 13

Internal control

1.1 Internal control definitions

 Controls – attempt to ensure that risks are minimised.

 An internal control system – network of systems established in an
organisation to provide reasonable assurance that organisational
objectives will be achieved.

 Internal management control – procedures and policies in place to
ensure that company objectives are achieved.

Note: The control procedures and policies provide the detailed controls
implemented within the company.

1.2 Objectives of internal control systems

An internal control system is to ensure, as far as practicable:

 the orderly and efficient conduct of its business, including
adherence to internal policies

 the safeguarding of assets of the business

 the prevention and detection of fraud and error

 the accuracy and completeness of the accounting records

 the timely preparation of financial information.

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