Internal Controls – Why they are important (Text-Based)

Field: Auditing | Delivery Method: Self-Study | CPE Hours: 2.0

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The topic of internal control has long been an issue for business. Management may view internal control as a set of forms, checklists, and templates that auditors require. However, internal control is much more.

Since the passage of the Sarbanes-Oxley Act (SOX), internal control (especially over financial reporting) has become a major focus for all organizations, regardless of their status as public, private, not-for-profit, sole proprietorship, partnership, or corporation. It is essential that managers understand and establish sound, effective, and proper internal controls for operations, compliance, and financial processes within the organization. Internal control can truly provide ultimate organizational value.

Internal controls are defined as the mechanisms, rules, and procedures implemented by a company to ensure the integrity of financial and accounting information, promote accountability, and prevent fraud. Internal controls is a means by which an organization’s resources are directed, monitored, and measured. This includes operational and compliance activities. It plays an important role in preventing and detecting fraud and protecting the organization’s resources.

Internal control is affected by an organization’s structure, work and authority flows, people, and information systems, and is designed to help the organization accomplish specific goals or objectives. For instance, a small organization with limited resources may not be able to segregate duties with the same rigor that a larger organization can. However, that does not give small organizations an excuse to ignore the importance of that control. They must find other ways to mitigate potential issues. In any event, internal control is part of an organization’s overall responsibility and required due diligence to ensure its operations are effective. Management is the “keeper” and “inventor” of internal controls and must take ownership.

Lesson Objectives
  • Understand the concept of internal controls
  • Identify the history behind internal controls
  • Comprehend the COSO Integrated Internal Control Framework
  • Identify why internal controls are not infallible
  • Understand who maintains responsibility for internal controls
  • Understand methods to identify and document internal controls
  • Examine a generalized checklist of internal controls for various processes.

Field: Auditing
CPE: 2.0
Delivery Method: Self-Study
Format: Text




Your Instructor


Lynn Fountain
Lynn Fountain

Consultant, CPA, CGMA, CRMA, MBA, Past Chief Audit Executive

Business Consultant, Trainer, Author


Ms. Fountain has over 40 years of experience spanning public accounting, industry accounting and consulting. Sixteen years of that experience has been in the field of internal audit, risk managment and process improvement. She is well adept to assist your organization evaluate business strategy, perform risk assessments, establish a Sarbanes-Oxley process, synergizing internal audit processes or perform process improvement projects.


As a past corporate executive Lynn has a passion for working with professionals to enhance their processes and provide leading edge education. She has authored and delivered hundreds of training courses for accounting, finance and audit professionals. Her training is filled with not just theory but real world application.


Ms. Fountain has authored three technical publications:

-Leading the Internal Audit Function 

-Raise the Red Flag

-Ethics and the Internal Auditor's political dilemma


Lynn is a recognized leader in the internal audit profession as well as a recognized business professional.  


Ms. Fountain obtained her BSBA from Pittsburg State University and her MBA from Washburn University in Kansas. She has active, current CPA, CGMA, and CRMA credentials.


https://www.lynnfountain.net/


Course Curriculum


  Internal Controls – Why they are important
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