Guide to 20 Essential Internal Controls with Exmaples

As finance and accounting professionals, one of our fundamental responsibilities is to mitigate risk. This guide of 20 Essential Internal Controls is to get you started. Check it out and let me know which internal controls you plan to implement and what I've missed!

✅ 𝗔𝗰𝘁𝗶𝘃𝗶𝘁𝘆-𝗟𝗲𝘃𝗲𝗹 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
These controls are implemented to monitor and manage specific tasks.

✅ 𝗔𝗱𝗲𝗾𝘂𝗮𝘁𝗲 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
The measures, processes, and systems are put in place to ensure financial information's accuracy, reliability, and integrity.

✅ 𝗔𝗽𝗽𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
The specific measures and safeguards implemented within financial software applications.

✅ 𝗔𝘀𝘀𝘂𝗿𝗮𝗻𝗰𝗲 𝗠𝗮𝗽𝗽𝗶𝗻𝗴
A visual representation framework is utilized to depict the crucial risks, controls, and assurance activities in an organization.

✅ 𝗖𝗢𝗕𝗜𝗧 - 𝗖𝗼𝗻𝘁𝗿𝗼𝗹 𝗢𝗯𝗷𝗲𝗰𝘁𝗶𝘃𝗲𝘀 𝗳𝗼𝗿 𝗜𝗧
This framework facilitates the alignment of control requirements, technical challenges, and business risks for managers.

✅ 𝗖𝗼𝗺𝗽𝗲𝗻𝘀𝗮𝘁𝗶𝗻𝗴 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
Measures implemented to mitigate or counterbalance the risk inadequacy of primary controls.

✅ 𝗖𝗼𝗿𝗽𝗼𝗿𝗮𝘁𝗲 𝗚𝗼𝘃𝗲𝗿𝗻𝗮𝗻𝗰𝗲
A system of rules, practices, and processes by which a company manages its relationship with internal and external stakeholders.

✅ 𝗗𝗲𝘁𝗲𝗰𝘁𝗶𝘃𝗲 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
A type of control implemented to identify and detect errors or non-compliance after they occur.

✅ 𝗗𝗶𝗿𝗲𝗰𝘁𝗶𝘃𝗲 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
Controls that provide explicit instructions or guidelines for employees or individuals to follow.

✅ 𝗘𝗻𝘁𝗶𝘁𝘆-𝗟𝗲𝘃𝗲𝗹 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
Controls that operate organization-wide influence the overall management.

✅ 𝗜𝗻𝗵𝗲𝗿𝗲𝗻𝘁 𝗥𝗶𝘀𝗸
The level of risk in a process or activity, without considering the mitigating effects of controls.

✅ 𝗜𝗗&𝗣𝗦
Tools/devices designed to monitor network or system activities.

✅ 𝗣𝗿𝗲𝘃𝗲𝗻𝘁𝗶𝘃𝗲 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
Controls are designed to prevent issues from occurring in the first place.

✅ 𝗣𝗿𝗼𝗰𝗲𝘀𝘀𝗶𝗻𝗴 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
Measures implemented to ensure accurate, complete, and timely processing.

✅ 𝗦𝘆𝘀𝘁𝗲𝗺 𝗼𝗳 𝗜𝗻𝘁𝗲𝗿𝗻𝗮𝗹 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
A comprehensive framework is implemented within an organization.

✅ 𝗦𝗲𝗰𝗼𝗻𝗱𝗮𝗿𝘆 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
Measures to mitigate risks or compensate for weaknesses in primary controls.

✅ 𝗦𝗼𝗳𝘁 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
Behavioral controls are the intangible factors influencing an organization's culture.

✅ 𝗧𝗵𝗿𝗲𝗲 𝗟𝗶𝗻𝗲𝘀 𝗠𝗼𝗱𝗲𝗹
A framework that delineates roles and responsibilities within an organization.

✅ 𝗧𝗿𝗮𝗻𝘀𝗮𝗰𝘁𝗶𝗼𝗻 𝗟𝗲𝘃𝗲𝗹 𝗖𝗼𝗻𝘁𝗿𝗼𝗹𝘀
Measures implemented to ensure the accuracy of individual transactions.

✅ 𝗕𝗼𝗻𝘂𝘀 𝗖𝗼𝗻𝘁𝗿𝗼𝗹 – 𝗬𝗼𝘂𝗿 𝗢𝘄𝗻 𝗜𝗻𝘀𝘁𝗶𝗻𝗰𝘁𝘀
Consider your instincts and judgment when evaluating risks.