Internal Control Organization Procedure

Internal control represents the totality of policies and procedures adopted by management, which contribute: to the fulfilment of managerial objectives, to the prevention and detection of frauds or errors, to the accuracy and exhaustiveness of accounting entries, as well as to the preparation in due course of financial accounting information. Internal control represents a managerial instrument which assures the fulfilment of objectives of the entity, being an ongoing process in which administrative management, executive management and the whole staff of the entity participates, and by which is provided a reasonable assurance on the achievement of objectives of the entity. The entity has to elaborate its own strategy of control, in view of avoiding risks, which can determine unwanted deviations from the policies and objectives established. The control strategy will mainly aim at: integration of control in process and structural components of organization of the entity; definition of objectives of control; establishment of the types of control which will be applied, of the methods and procedures which must be used within them; elaboration of control plans or programmes; training of staff with control assignments; methods of evaluation and revaluation of control results; effectiveness of control in the light of the criterion costs or benefits.