What is an Internal Control Software?
Internal control software is a better way to investigate and thoroughly check the management of an organization to prevent errors, issues, non-conformance, non-compliance, and fraud. Internal control software improves corporate governance and external communications e.g., in financial aspects. Additionally, it can improve the efficiency and effectiveness of compliance audits, cutting costs and helping businesses in monitoring progress.
What is Internal Control?
The Committee of Sponsoring Organizations of the Treadway Commission (COSO) defines internal control, in its Internal Control–Integrated Framework Executive Summary, as a process designed to provide assurance regarding the achievement of the following objectives:
Operations—pertains to the effectiveness and efficiency of an organization, including operational and financial performance
Reporting—pertains to the reliability and transparency set forth by the organization’s policies
Compliance—pertains to adherence to laws and regulations
COSO is an initiative of professional organizations dedicated to help businesses improve performance by enhancing their internal control, risk management, governance, and fraud deterrence.
Components of Internal Control
COSO also provided in their Executive Summary, mentioned earlier, five integrated components of internal control, which are:
Control Environment —pertains to the set of standards, processes, and structure of an organization
Risk Assessment—pertains to the process of identifying risks that may hinder the achievement of objectives
Control Activities —pertains to the actions made by the policies and procedures for mitigating risks
Information and Communications—pertains to the information gathered from internal and external sources and the act of sharing that information with relevant stakeholders
Monitoring Activities —pertains to the activities ensuring that the components of internal control are present and well-functioning
