1. Chapter 9 Control, security and audit

2. Introduction of internal control
Internal controls is any action taken by management to enhance the likelihood that established goals and objectives will be achieved.
Internal controls are helpful in countering risk, maintaining the reporting quality, and complying with laws and regulations.
Turnbull guidelines

3. Internal control system
Including all the policies and procedures adopted by the directors and managers,
Control environment: the overall context of control, like the attitude of directors or managers towards control.
Control procedures: the detailed controls

4. Internal control environment
It is the overall attitude, awareness and actions of directors and management regarding internal controls and their importance.
It provides a background.
It is influenced by managers’ altitude, organizational structure and the values and abilities of employees.

5. Internal control procedures
They are the policies and procedures in addition to the control environment.
The control procedures have many classifications.
SPAMSOAP

6. Internal checks
Internal checks are the checks on the day-to-day transactions.
Internal checks are an important feature of the day-to-day control of financial transactions and the accounting system.
Internal checks are used to reduce the possibility of fraud and error.

7. Internal audit
It is a part of the internal control system, and it examine and evaluate the adequacy and effectiveness of other controls.
Internal auditor is accountable to the highest executive level, and he is independent.
Five types of audit: operational, systems, transactions, social, and management investigations.

8. Objectives of internal audit
Review of the accounting and internal control systems
Examination of information
Review of operation’s efficiency
Review of compliance with laws
Review of the safeguarding of assets
Identification of risks
Special investigations

9. External audit
External auditors are from accountancy firms, and their role is to report on the financial statements to shareholders.
There are many differences between external and internal audit, but external and internal auditors coordinate with each other.
External auditors must assess the internal audit function.

10. IT system security
In information management terms, security is the protection of data from accidental of deliberate threats and the protection of an information system from such threats.
Controls in an information system include security controls, integrity controls and contingency controls.