Challenges for internal control within organizations

MONTVALE, NJ/ACCESSWIRE/July 6, 2022/ The purpose and effectiveness of internal control is being tested like never before by a myriad of external pressures, reveals a new report from ACCA (the Association of Chartered Chartered Accountants), the Internal Audit Foundation and the IMA® (Institute of Management Accountants).

In “Internal control and transformation of entities”the three professional bodies have joined forces to survey some 2,000 of their members around the world to better understand what awaits internal control, an essential element of business operational management that achieves important objectives, improves performance and builds reputation, especially in times of disruption and uncertainty. as entities continue to transform using data and technology as drivers.

The results show that the lingering effects of the pandemic, the turbulent economic climate, regulation, data and technology all present organizations with unique challenges to their internal control activities.

Lack of qualified staff was highlighted by 50% of respondents as a challenge, and 41% said that technological advancements are undermining existing internal controls. Nearly a third (32%) said management’s lack of focus on internal controls also impacts internal control management.

Respondents were also asked about the purpose of internal control in an entity, with 88% saying it minimizes risk, 84% cited fraud prevention and 77% asset protection.

The survey also shows that most respondents – 80% – agree or strongly agree with the need to apply their internal control framework to non-financial and ESG reporting.

Helen Brand, Director General of ACCA, said: “Internal control is an integral part of the activities of accounting, finance and internal audit professionals, helping them to ensure that entities operate in a effective and efficient. Yet the business model is changing for many due to diverse and interconnected external pressures. Given this ongoing turbulence, it is therefore critical that organizations recruit and retain the skilled people who can ensure internal controls are nimble and future-ready to support business transformation and growth.

Jeff Thomson, CMA, CSCA, CAE, President and CEO of IMA, added, “As we say in the foreword to our report, internal control goes beyond legal compliance requirements. It helps entities build trust, confidence and a positive reputation in achieving strategic business outcomes. All of this is increasingly vital now and in the future as we do not see the turbulence or volatility diminishing.

Anthony J. Pugliese, President and CEO of The IIA, Internal Audit Foundation Board of Trustees, added, “Internal control requires proper leadership prioritization and a combination of people, process, technology and data, all underpinned by an unwavering commitment to trust. and ethics. The way to achieve this is through professional qualifications and continuous professional development, which our three organizations are committed to providing now and in the future.

The report also makes numerous recommendations and actions to improve internal control listed under the headings of key drivers of change – such as strategy, transformation, people, process, technology and data.

Clive Webb, co-author of the report and head of business information at ACCA, concluded: “Our recommendations will help accountants, finance professionals and internal auditors navigate the way forward as entities evolve and are constantly changing. The role of our collective professions in this change is essential, and we are confident that their skills, knowledge and dedication will ensure the future strength and integrity of internal control processes in an increasingly hard.

The report can be downloaded here: www.myima.org/internalcontrol

About ACCA: ACCA is the Association of Chartered Chartered Accountants. We are a thriving global community of 233,000 members and 536,000 future members based in 178 countries and regions that uphold the highest professional and ethical values.

We believe that accounting is a fundamental profession of society that supports both the public and private sectors. This is why we are committed to developing a strong global accountancy profession and the many benefits this brings to society and individuals.

Since 1904, being a force for the public good has been embedded in Our goal. And because we are a not-for-profit organization, we are building a sustainable global profession by reinvesting our surplus to deliver member value and grow the profession for the next generation.

With our world-leading ACCA qualification, we offer everyone, everywhere the opportunity to enjoy a rewarding career in accounting, finance and management. And through our respected research, we’re leading the profession in answering today’s questions and preparing for tomorrow.

ACCA and CA ANZ have formed a strategic alliance for the benefit of members and to help shape the future of the profession. Learn more about us at accaglobal.com.

About the Internal Audit Foundation and the Institute of Internal Auditors: The Internal Audit Foundation is an essential global resource for advancing the internal audit profession. Foundation-funded research provides internal audit practitioners and their stakeholders with insight into emerging topics and promotes and advances the value of the internal audit profession globally. Additionally, through its Academic Fund, the Foundation supports the future of the profession by providing grants to students and educators who participate in the Institute of the Internal Auditor’s Internal Audit Training Partnership Program. For more information visit www.theiia.org/Foundation

The Institute of Internal Auditors (IIA) is the most widely recognized advocate, educator, and provider of standards, guidance, and certifications for the internal audit profession. Founded in 1941, The IIA today serves more than 210,000 members in more than 170 countries and territories. For more information, visit www.theiia.org.

About the IMA® (Institute of Management Accountants): IMA® is one of the largest and most respected associations dedicated exclusively to advancing the management accounting profession. Overall, IMA supports the profession through research, the CMA® (Certified Management Accountant) and CSCA® (Certified in Strategy and Competitive Analysis), Continuing Education, Networking, and Advocacy for the Highest Ethical Business Practices. Twice named professional body of the year by The Accountant / International Accounting Bulletin, IMA has a global network of approximately 140,000 members in 150 countries and 350 professional and student chapters. Based in Montvale, NJ, USA, IMA provides localized services in its four global regions: Americas, Asia/Pacific, Europe and Middle East/India. For more information about IMA, please visit www.imanet.org.

CONTACT:

Giuseppe Baron
IMA
(201) 474-1681
[email protected]

Brian Sherry
Stern Strategy Group
(908) 325-3860
[email protected]

THE SOURCE: IMA® (Institute of Management Accountants)

See the source version on accesswire.com:
https://www.accesswire.com/707418/Challenges-Lie-Ahead-for-Internal-Control-Within-Organizations

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