A Clear Look at Internal Controls: Theory and Concepts

27 Pages Posted: 13 Feb 2009 Last revised: 4 Apr 2010

See all articles by Babk Jamshidi-Navid

Babk Jamshidi-Navid

Islamic Azad University, Kerman shah, Iran

Hamed Arad (Philee)

Islamic Azad University - Department of Accounting, Hamedan, Iran

Date Written: March 2010

Abstract

Internal control is an accounting procedure or system designed to promote efficiency or assure the implementation of a policy or safeguard assets or avoid fraud and error. Internal Control is a major part of managing an organization. It comprises the plans, methods, and procedures used to meet missions, goals, and objectives and, in doing so, support performance-based management. Internal Control which is equal with management control helps managers achieve desired results through effective stewardship of resources. Internal controls should reduce the risks associated with undetected errors or irregularities, but designing and establishing effective internal controls is not a simple task and cannot be accomplished through a short set of quick fixes. In this paper the concepts of internal controls and different aspects of internal controls are discussed.

Keywords: Internal Control, Management Controls, Control Environment, Control Activities, Monitoring

JEL Classification: M41

Suggested Citation

Jamshidi-Navid, Babk and Arad, Hamed, A Clear Look at Internal Controls: Theory and Concepts (March 2010). Available at SSRN: https://ssrn.com/abstract=1342048 or http://dx.doi.org/10.2139/ssrn.1342048

Babk Jamshidi-Navid

Islamic Azad University, Kerman shah, Iran ( email )

kermanshah
Iran

Hamed Arad (Contact Author)

Islamic Azad University - Department of Accounting, Hamedan, Iran ( email )

Hamedan, Iran
Tehran, Isfahan 461-15655
Iran

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