TESTING A SYSTEM OF ENTERPRISE INTERNAL CONTROLJournal: Herald of Kyiv National University of Trade and Economics (Vol.95, No. 3)
Publication Date: 2014-06-05
Authors : BEZVERHIY Konstantyin;
Page : 96-108
Keywords : internal control; system; testing; process; efficiency; auditing standard; Sarbanes-Oxley Act; COSO.;
Background. The complexity of economic entity management in an unstable environment in which they operate requires the creation of an adequate system of internal control of the company, which will enable its stable operation. To solve this problem it is offered to evaluate the effectiveness of the existing internal control of the company through testing. Of particular relevance is the question of testing the system of internal control, which is an important tool for ensuring the ongoing activities of the company. Review of scientific sources in this field indicates that the scientists conduct debate to develop tools of internal control of the company. A small amount of work among existing research on approaches to evaluating the effectiveness of internal control of the company is dedicated to using them in enterprise management. However, the use of the mechanism of internal control company testing can bring it to a new level, as formulated in the purpose of the research. Results. In order to evaluate the quality of the system of internal control for financial reporting purposes, company management must determine the effectiveness of control mechanisms used. To do this they should carry out their tests, covering all five elements of internal control of the company (methodology COSO). You must determine to what extent the requirements in the financial statements are met, to evaluate all statements reporting in the context of each key business unit. While testing particular attention should be paid to specific risks in the enterprise, even if they are not significant. Conclusion. Thus, the mechanism of internal control of testing a company was developed. Its implementation allows the assessment of the effectiveness of internal control of the enterprise and can detect weaknesses in internal control risk.
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