INTRODUCTION: THE STANDARDS OF internal control are provided for key processes within the fiscal close. Examples of standards are provided for the transaction accumulation, reconciliation, and sub-ledger close, the corporate close and consolidation process, and the reporting and analysis process.
The discussion usually moves toward ownership—finance versus operations. A major accomplishment for any company's business controls program would be to communicate and implement a consistent definition or approach to standards of internal control to reduce risk during the fiscal close process and to ensure accurate financial reporting as outlined in each standard.
An attempt at such a definition is: An internal controls program is an initiative that is managed within each operating unit. Management is committed to the program and is held accountable for the results and the correction of any deficiencies identified. Management is held responsible to revise and update their business controls program as changes arise within their operating units as well as identify regulatory compliance requirements.
Standards of internal control as defined by a company's internal controls program can be addressed at the strategic and tactical levels. The components at the strategic level include architecture, policy definition, program integration, and planning and metrics.
The tactical or transaction level is where the strategic direction is ...