Evaluation of the effectiveness of the internal control system of the institution using key performance indicators

The conducted research may be of interest to specialists of internal audit, internal control, and managers of all levels, who organize the functioning of internal control in subordinate structural units. The article practically substantiates the use of the matrix of key performance indicators (KPI) in assessing the effectiveness of the internal control system of the Ministry of Defense of Ukraine. The research conducted in the article is the result of the practical implementation of the developed comprehensive methodology for assessing the effectiveness of the internal control system of the Ministry of Defense of Ukraine. To achieve this goal, the study conducted its decomposition and separately: evaluated the selected indicators of the effectiveness of the internal control system through appropriate testing and analysis of financial (accounting) statements; a matrix of key performance indicators is formed; the generalized indicator of efficiency of functioning of system of internal control is defined; the corresponding assessment of efficiency of system of internal control according to the chosen criterion is carried out. The results of the study made it possible to determine a numerical value that can objectively indicate the effectiveness of the internal control system of the institution. The results of the evaluation of indicators can be further systematized in the appropriate database for the formation of statistical information and taken into account in the risk-oriented planning of internal audit activities. The results of the study in the article can be used in part and applied thematically when checking other indicators in the internal control system. The article formulates the prospect of further research in the subject area to improve the accuracy of assessing the effectiveness of the ICS, as well as in finding alternative methods for its evaluation.

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Applying a matrix of key performance indicators in the evaluation of internal control institutions

Journal of Scientific Papers Social development & Security ◽

10.33445/sds.2020.10.1.5 ◽

2020 ◽

Vol 10 (1) ◽

pp. 34-46

Author(s):

Anatolii Loishyn

Keyword(s):

Control System ◽

Internal Control ◽

Performance Indicators ◽

Internal Audit ◽

Key Performance Indicators ◽

Financial Accounting ◽

Practical Implementation ◽

Internal Control System ◽

The Matrix ◽

Generalized Indicator

The conducted research can be of interest to the specialists of internal audit, internal control, and heads of all levels who organize the functioning of internal control in subordinate structural units. The article substantiates the use of the Key Performance Indicators (KPI) matrix in assessing the effectiveness of the internal control system of the Ministry of Defense of Ukraine. The research conducted in the article is the result of the practical implementation of the developed complex methodology for evaluating the effectiveness of the internal control system of the Ministry of Defense of Ukraine. In order to accomplish this task, the study carried out its decomposition and separately: conducted an assessment of selected indicators of the effectiveness of the internal control system through appropriate testing and analysis of financial (accounting) reporting; the matrix of key performance indicators is formed; a generalized indicator of the efficiency of the functioning of the internal control system is determined; a proper evaluation of the performance of the internal control system was performed according to the selected criterion.

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ORGANIZATION OF INTERNAL CONTROL BY BUDGET ORGANIZATIONS (INSTITUTIONS) AS A BUDGETARY FUNDS MANAGER

Criminalistics and Forensics ◽

10.33994/kndise.2019.64.65 ◽

2019 ◽

pp. 689-698 ◽

Cited By ~ 1

Author(s):

K. Proskura

Keyword(s):

Control System ◽

Internal Control ◽

Internal Audit ◽

Control Measures ◽

Practical Implementation ◽

Parent Organization ◽

Control Units ◽

Internal Control System ◽

Information And Communication ◽

Five Elements

This article is devoted to the study of the organization and formation of the system of internal control by budget organizations (institutions), the definition and substantiation of the components and procedures of internal control, as well as the development of a mechanism for the practical implementation of this system in a budget institution (organization). The construction of an internal control system of a budgetary institution is based on the components: control environment (construction of the structure of the internal control system and its subordination, responsibilities and powers of internal controllers, requirements to their competence, their independence with respect to utsanov), risk management (identification and assessment of the probability and risk impact on the institution’s activities, costs, the risk response, in comparison with the resulting benefit from its reduction), control measures (which procedures and measures are implemented by the institution in order to ensure the effectiveness of internal control), information and communication, monitoring (reporting of internal control units and checking the results of its work by the supreme body). The organizational principles for the construction of internal control, the principles on which internal control is to be based, as well as the essence of the five elements of internal control, in accordance with which internal control is to be carried out by the administrators of budget funds, is regulated in the Methodological Recommendations on the organization of internal control by budgetary funds managers. in their institutions and in subordinate budget institutions (approved by the order of the Ministry of Finance of Ukraine dated September 14, 2012 No. 995). An important factor in the effectiveness of the internal control system’s operation is the accountability of the internal control units to the manager and parent organization, embodied in the provision of written reports on the results of control measures carried out with a certain periodicity, as well as the introduction of a mechanism for monitoring the elimination of identified deficiencies and violations. The existence and effectiveness of the internal control system’s functioning forms the basis for ensuring the effectiveness of the organization, including the efficient use of economic resources. Key words: budgetary institution, internal control, internal control system, internal audit department.

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KEEFEKTIFAN AUDIT INTERNAL PEMERINTAH DAERAH

Jurnal Akuntansi ◽

10.24912/ja.v20i1.74 ◽

2017 ◽

Vol 20 (1) ◽

pp. 33

Author(s):

Hadi Mahmudah ◽

Bambang Riyanto LS

Keyword(s):

Control System ◽

Local Government ◽

Control Systems ◽

Internal Control ◽

Positive Impact ◽

Internal Audit ◽

System Management ◽

Management Support ◽

Internal Control System ◽

Audit Effectiveness

Penelitian ini menguji efektifitas sistem pengendalian intern, dukungan manajemen dan audit professionalism terhadap keefektifan audit internal. Sampel dalam penelitian ini adalah 39 Inspektorat Daerah dari enam Provinsi. Penelitian ini menggunakan regresi berganda untuk menganalisis data. Hasil penelitian menunjukkan bahwa sistem pengendalian intern dan dukungan manajemen berpengaruh secara positif terhadap keefektifan audit internal. Penelitian ini gagal memberikan bukti empiris audit professionalism berpengaruh terhadap keefektifan1 audit internal. Penelitian ini memperkaya penelitian yang sudah ada terkait keefektifan audit internal dan penekanan pentingnya sistem pengendalian intern di pemerintah daerah.This study examined the effectiveness of internal control system, management support, and audit professionalism on internal audit effectiveness of local government. The sample consists of 39 regional inspectorates of six provinces in Indonesia. By using multiple regressions, this study found that internal control system and management support has positive impact on the effectiveness of the internal audit. However, there is no support for the audit professionalism on internal audit effectiveness. This study enriches existing research related to the effectiveness of the internal audit and emphasis the importance of internal control systems in local government.

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Selection of indicators of the scientific and methodological apparatus for assessing the effectiveness of the internal control system of the ministry of defense of Ukraine

Journal of Scientific Papers Social development & Security ◽

10.33445/sds.2019.9.3.6 ◽

2019 ◽

Vol 9 (3) ◽

Author(s):

Anatolii Loishyn

Keyword(s):

Control System ◽

Internal Control ◽

Internal Audit ◽

Armed Forces ◽

Research Problem ◽

Scientific Discussion ◽

Logical Sequence ◽

Literary Sources ◽

Internal Control System ◽

Definition Of

The article summarizes the arguments and counterarguments in the framework of scientific discussion on the choice of indicators of the scientific and methodological apparatus for assessing the effectiveness of the system of internal control of the Ministry of Defense of Ukraine. The main purpose of the study is to study the possibility of choosing the indicators of the scientific and methodological apparatus for assessing the effectiveness of the internal control system. The systematization of literary sources and approaches to solving the problems considered in the article showed that the research problem is partly described and needs to be generalized and revised. The urgency of solving this scientific problem lies in the fact that the system of the Ministry of Defense of Ukraine and the Armed Forces of Ukraine actively implements a risk-oriented system of internal control in accordance with the general reform of the defense department to NATO standards. The research of the choice of indicators of the effectiveness of the internal control system in the article is carried out in the following logical sequence: the definition of the corresponding conceptual apparatus is formulated, namely, the interpretation of the terms: "indicator", the available approaches to the assessment of the effectiveness of the internal control system for the presence of indicators; a choice of indicators was made based on the results of their analysis and comparison, which can be offered to the scientific and methodical apparatus for assessing the effectiveness of the internal control system of the Ministry of Defense of Ukraine. The methodical tools of the research were the methods of analysis, synthesis, comparison, induction; the study period is the years from 1976 to the present. The object of the study is the process of assessing the effectiveness of the system of internal control in the system of the Ministry of Defense of Ukraine, since it is not sufficiently investigated. The study presents the results of empirical analysis of the choice of indicators, which showed the possibility of their inclusion in further research. The study empirically confirms and theoretically proves that these indicators must be taken into account when assessing the effectiveness of the internal control system of the Ministry of Defense of Ukraine. The results of the research can be useful for internal control and internal audit specialists.

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Internal audit in the period of economic changes and its role in evaluation of the entity’s internal control. Theoretical characteristics and practical approaches

Problems of Theory and Methodology of Accounting Control and Analysis ◽

10.26642/pbo-2021-2(49)-19-28 ◽

2021 ◽

pp. 19-28

Author(s):

Cristina Vasile Dolghi ◽

Elena Gheorghe Petreanu

Keyword(s):

Control System ◽

Internal Control ◽

Assessment Tool ◽

Internal Audit ◽

Evaluation Process ◽

Primary Role ◽

Control Environment ◽

Internal Control System ◽

Control Evaluation ◽

Method Of Evaluation

Internal control delivers guarantee and trust for investors, clients, suppliers, but also for the entity’s employees and other interested parties. As a result, an effective internal control system has a significant impact on the credibility of a modern entity and its activities, which is ensured by the entity’s management, through an appropriate process of evaluating the effectiveness of internal control. On the basis of those exposed, we sustain the opinion shared by many experts in the field, that the primary role in evaluating the internal control system is attributed to internal audit, because in line with current development trends, it supports the entity in maintaining effective controls by evaluating efficiency and effectiveness. As well as by promoting biased business actions. In this connection, the authors approach the study of the basic aspects of the internal control evaluation process in the light of the identification of the method, establishing and interpreting the indicators used in the evaluation, as well as determining the criteria and practical tools for evaluation. As a method of evaluation of internal control the systematic method of authors is proposed, which involves the evaluation of each component of it. This approach permits internal auditors to make an integrated consideration of the effectiveness of internal control in the entity of the internal control system in the good functioning of the entity, which contributes to the fulfillment of its strategic objectives. In addition, the research carried out highlights the performance of the assessment tool – the corresponding questionnaire, which was developed to evaluate the control environment of the entity and applied in the activity of public interest entities in the Republic of Moldova. This study offers the possibility to recognize the deficiencies within the control environment established at the entity and offers the possibility to the management of the entity to improve its functioning mechanism.

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PELAKSANAAN FUNGSI APARAT PENGAWAS INTERN PEMERINTAH (APIP) UNTUK MENUNJANG TINGKAT KEWAJARAN LAPORAN KEUANGAN PEMERINTAH KOTA MANADO

JURNAL RISET AKUNTANSI DAN AUDITING "GOODWILL" ◽

10.35800/jjs.v7i2.13549 ◽

2016 ◽

Vol 7 (2) ◽

Author(s):

Merry Inggrid Siwy ◽

David P.E. Saerang ◽

Herman Karamoy

Keyword(s):

Control System ◽

Local Government ◽

Financial Reporting ◽

Internal Control ◽

Financial Management ◽

Internal Audit ◽

Financial Statements ◽

Internal Auditor ◽

Internal Control System ◽

The Government

Internal Audit is the whole process of audit activities, the Review, evaluation, monitoring and supervisory activities other against the implementation of tasks and functions of the organization in order to provide reasonable assurance that the activities have been carried out in accordance with the benchmarks that have been set effectively and efficiently for the benefit of the leadership to Realize good governance.Accountability and transparency in the new government could be achieved if all levels of leadership controlling activities on the overall activities in their respective agencies . Internal control system ( SPI ) is a process that is integral to the actions and activities carried out continuously by the management and all employees to provide reasonable assurance on the achievement of organizational goals through effective and efficient , the reliability of financial reporting , the safeguarding of state assets, and compliance with legislation. To strengthen and support the effectiveness of internal control over the SPI made implementation of tasks and functions of government agencies including state audits carried out by the internal control official Government ( APIP ) .The auditor's responsibility to detect fraud or irregularity embodied in the planning and execution to obtain reasonable assurance about whether the financial statements have been prepared in accordance with established standards.The purpose of this study was to analyze the functions of Government Internal Supervisory Apparatus (APIP) / Internal Auditor in supporting reasonable levels of Local Government Finance Report Manado City. Respondents were selected are few skilled examiner at the office of the Inspectorate of Manado. Approach Using Qualitative methods Ethnography.APIP functions that work well to prevent fraud , to produce valuable output to be input to the external auditor , the executive and the legislature to improve financial management and accountability in the area of the future . Eksternal Auditor may use the results from the monitoring APIP mainly reviews the financial statements of the government , supporting the management of local government in implementing the recommendations and improvements Internal control system . APIP professional and independent encourage increased transparency and accountability in financial management to improve the fairness of the financial statements . Keywords: Government Internal Supervisory Apparatus, fraud detection, the fairness of the financial statements

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The role of internal audit in the functioning of an effective system of internal control of enterprises

Vestnik Universiteta ◽

10.26425/1816-4277-2021-4-130-137 ◽

2021 ◽

pp. 130-137

Author(s):

I. I. Chebyshev

Keyword(s):

Control System ◽

Internal Control ◽

Internal Audit ◽

Research Area ◽

Point Of View ◽

Internal Control System ◽

Effective System

The author carried out research of the list of issues related to the field of internal audit, namely its role in achieving the effectiveness of the internal control system. The article logically emphasizes the significance of the research area, discloses the objectives and procedure for conducting internal audit. The paper reveals the issues of the organization and functioning of internal audit as a tool for solving the problems of the company in order to increase the efficiency of its activities and investment attractiveness. From a scientific point of view, the study becomes relevant due to the problems presented and the proposed solutions. Among the identified problems there are such as inefficiency of internal audit, errors of subordination, etc.

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Faktor-faktor yang Memengaruhi Kualitas Laporan Keuangan Pemerintah Daerah di Kabupaten Banyuasin dengan Sistem Pengendalian Internal Pemerintah sebagai Variabel Moderasi

Jurnal Ilmiah Ekonomi Global Masa Kini ◽

10.36982/jiegmk.v10i1.744 ◽

2019 ◽

Vol 10 (1) ◽

pp. 55

Author(s):

Reny Aziatul Pebriani

Keyword(s):

Control System ◽

Local Government ◽

Internal Control ◽

Accounting Standards ◽

Internal Audit ◽

Financial Statement ◽

Government Accounting ◽

Internal Control System

ABSTRACTThe aim of this study is to determine and analyse the effect of human resource competence, utilization of information technology, the implementation of government accounting standards, the role of internal audit on the quality of local government financial statement and its effect on regional work unit that is moderated by government internal control system in Banyuasin. The method used is descriptive and explanatory survey using 108 respondents. The data analysis method used in this study is multiple regression analysis and the moderating effect is tested using Moderated Regression Analysis through SPSS 23. The results show that human resource competence, utilization of information technology, the implementation of government accounting standards, the role of internal audit have simultaneous and significant effect on the quality of local government financial statement. However, when it is tested partially, the implementation of government accounting standards is found to be insignificant. Furthermore, the role of internal that is moderated by government internal control system does not have significant effect on the quality of local government financial statement. The results indicate that to improve the quality of local government financial statement, continues improvement on government internal control system is needed. the government needs to improve the quality of internal audit to improve the role of supervision, coaching, monitoring, and review of financial statements so as to be able to work professionally, objectively and independently.Keywords : Human resource competence, utilization of information technology, government internal control system, Government financial statement quality.ABSTRAKTujuan dari penelitian ini adalah untuk mengetahui dan menganalisis besarnya pengaruh kompetensi SDM, pemanfaatan TI, penerapan SAP, peran Audit Internal secara parsial maupun bersama-sama terhadap kualitas LKPD dan pengaruhnya yang dimoderasi oleh SPIP pada Organisasi Perangkat Daerah (OPD) Kabupaten Banyuasin. Metode yang digunakan adalah metode deskriptif dan survey eksplanatori dengan ukuran sampel 108 responden. Metode analisis data yang digunakan yaitu Regresi Linier Berganda dengan pengujian variabel moderasi menggunakan MRA (Moderated Regression Analysis) dan pengolahan data menggunakan software SPSS 23. Hasil penelitian ini membuktikan bahwa kompetensi SDM, pemanfaatan TI, penerapan SAP, peran Audit Internal secara bersama-sama berpengaruh dan signifikan terhadap kualitas LKPD, namun secara parsial penerapan SAP tidak berpengaruh secara signifikan. Kemudian secara moderasi variabel peran audit internal yang dimoderasi oleh SPIP tidak berpengaruh signifikan terhadap kualitas LKPD. Kesimpulan penelitian ini berhasil menemukan bahwa untuk meningkatkan kualitas LKPD studi kasus pada OPD di Kabupaten Banyuasin, diperlukan upaya perbaikan dan peningkatan secara berkelanjutan terhadap SPIP dalam rangka mempertahankan dan meningkatkan kualitas LKPD, pemerintah perlu meningkatkan kualitas audit internal guna meningkatkan peran pengawasan, pembinaan, pemantauan, dan reviu laporan keuangan sehingga mampu bekerja secara profesional, obyektif dan independen.Kata kunci : Kompetensi SDM, Pemanfaatan TI, SPIP, Kualitas LKPD

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The Internal Control System as a Management Function and the Element of Integrated Reporting Financial Statements

International Journal of Financial Research ◽

10.5430/ijfr.v11n6p262 ◽

2020 ◽

Vol 11 (6) ◽

pp. 262

Author(s):

Lyubov Plotnikova ◽

V. V. Rubanov

Keyword(s):

Control System ◽

Internal Control ◽

Information Disclosure ◽

Visual Analysis ◽

Internal Audit ◽

Research Process ◽

Financial Accounting ◽

Integrated Reporting ◽

Internal Control System ◽

Control Procedures

The present article is devoted to one of the most urgent problems of financial accounting organization and preparation of accounts – the issue of implementation of internal control in the companies. The authors consider the internal control as a function of management in interrelation with internal audit and risk management. The purpose of the research is to determine the level of information disclosure about the internal control system in the company's reporting. The research subject is the industrial and economic activity of chosen companies. Public integrated reporting is the object. The authors set out the following tasks in the research process: to estimate the degree of study of the problem; to analyze public reporting, including its structure, different report forms, the content of Explanatory Notes to the reporting and the working documents; to compare the reporting of various companies; and to identify the degree of information disclosure. The methodology of the research suggests an analysis of existing studies in the field of internal control, visual analysis of internal documents of the companies and their reporting and comparative assessment of reports of some companies. The authors study public accounts of the major companies, consider it from the view of completeness of disclosure of information about the internal control system, draw conclusions and give recommendations on improvement of control procedures. The authors justify that the two concepts of internal control and internal audit are not the same. However, the management of some companies does not separate them. The authors prove that internal auditing is only a part of the internal control system.

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The Impact of the Standards Implementation of Internal Audit Attributes on the Internal Control System Effectiveness: A Field Study of Banks in Yemen

مجلة الدراسات الاجتماعية ◽

10.20428/jss.26.4.5 ◽

2021 ◽

Vol 26 (4) ◽

pp. 111-132

Author(s):

Mohammed Ali M. Al-Rubaidi ◽

Abdulelah Ahmed Khobah

Keyword(s):

Control System ◽

Internal Control ◽

Positive Impact ◽

Internal Audit ◽

International Standards ◽

Audit Committees ◽

Continuous Training ◽

Internal Control System ◽

Audit Activity ◽

The Impact

This study aimed to investigate the impact of the implementation of internal audit characteristics on the effectiveness of the internal control system in banks in Yemen. To achieve the objective of this study, a questionnaire was designed as a tool for collecting the data from the study community which consisted of (18) banks in Yemen, (14) of which, in Sana'a city, were taken as a sample. The sample consisted of 190 employees selected from the internal auditors, internal audit committees and finance managers. The SPSS was used to analyze 155 questionnaires that were valid for analysis. The results of the study revealed that there is a statistically significant positive impact on the implementation of all standards of internal audit characteristics on the effectiveness of the internal control system. In the light of the findings, the study recommends that the Yemeni banks should adopt procedures to enhance the effectiveness of the internal control system, including providing sufficient authority for the internal audit activity The team of internal audit should have absolute independence and continuous training in line with international standards and developments; in addition, conducting a periodic and continuous evaluation of the internal audit activity is recommended to enhance the effectiveness of the internal control system.

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