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Defining Internal Control

28 August, 2015 - 16:52

In the preceding sections, we discussed the importance of an organization achieving an adequate level of internal control. But what do we mean by internal control? The COSO report mentioned earlier in the chapter emphasizes that internal control is a process. 1 A process is a series of actions or operations leading to a particular and usually desirable result. Results could be effective internal control, or a specified output for a particular market or customer. The idea of process is important to our understanding of internal control and business processes in modern organizations. Armed with this perspective, let’s proceed to a working definition of internal control to use throughout the text.