What are Internal Controls?
Internal controls, in the broadest sense, include the activities and procedures adopted by management to help meet their goals. Internal controls include processes for planning, organizing, directing, controlling, and reporting on the organization’s operations. Internal controls are an integral component of an organization’s operations that provide reasonable assurance that the following objectives are being achieved:
- Achievement of the organization’s strategic objectives.
- Reliability and integrity of financial and operational information.
- Effectiveness and efficiency of operations and programs.
- Safeguarding of assets, to include the economical and efficient use of University resources.
- Compliance with laws, regulations, policies, procedures, and contracts.
What are the Components of Internal Controls?
Management is responsible for developing and maintaining internal control activities that comply with the following five interrelated components: