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Accounting & Tax vocabulary · Auditing & Internal Control

Internal control

Meaning in accounting & tax, with examples

nounCommon term

In accounting & tax, internal control means: The policies and procedures a company uses to protect its assets, prevent errors and fraud, and make sure its financial reporting is reliable.

In Turkish: iç kontrol

How it is used

Examples include approval limits, segregation of duties and regular reconciliations. Auditors test controls and report control deficiencies. In the US, SOX requires listed companies to assess internal control over financial reporting.

Example sentences

  1. Good internal control means no one can create a new supplier and approve its payment alone.

  2. The auditors found a weakness in internal control over petty cash.

Common collocations

  • internal control system
  • segregation of duties
  • control weakness
  • test controls
  • internal control over financial reporting
  • auditAn independent examination of a company's financial statements and records to check that they are accurate and follow the applicable rules.
  • audit trailA record in time order that shows who entered, changed or approved each transaction and when, so it can be traced back to its source documents.
  • auditorA qualified professional who examines a company's accounts and records and gives an independent view on whether they are reliable.
  • misstatementA difference between an amount shown in the financial statements and the amount that should be shown, caused by error or fraud.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Auditing & Internal Control

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This page explains English vocabulary for learners. It is not financial advice.