Authors :
Dr. S Gopalakrishnan CFE
Volume/Issue :
Volume 7 - 2022, Issue 3 - March
Google Scholar :
https://bit.ly/3IIfn9N
Scribd :
https://bit.ly/3xtO6FQ
DOI :
https://doi.org/10.5281/zenodo.6452167
Abstract :
The success of any business solely depends on
the controls and processes adopted and implemented by
the business units. In the ancient times, the businesses
were conducted on judgemental basis, which purely
individual driven. The concept of collective efforts were
not felt and accordingly the merits and de-merits both
were witnessed related to those business ventures. As a
pinch of autocracy was dominating in those businesses, the
employees were considering the employment only as a job
for their earnings. But the modern management thoughts
takes the business to a different direction whereby
democratic participation of all the stakeholders are the
need of the hour and hence the management had to take a
paradigm shift in the way the businesses were directed.
The qualitative elements of the business are of high
priority in the current world, which triggers the need to
have greater economy, high employment growth and
delighted customers, for which strong risk management
processes must be embraced. In order to ensure,
consistency in terms of risk reduction, appropriate tools
ought to be designed and implemented by the Top
Management of the business houses and ultimately the
Internal controls serve as these tools. The robust controls
implemented at all levels of the business will be directing
towards a qualitative operations, presiding financials, and
sturdy compliances. The controls will be strengthening the
base of the operations which will further usher the cash
flows which are the foundation for business sustainability.
The control mechanisms will be leading to achieve high
persistency in terms of revenue and profitability growth
for the entity, as the productivity will be at the higher end
and the risks at the lower end. Any breakdown of controls,
may lead to an organizational collapse, as it will be
activating the fraudulent practices from the top to bottom.
Hence strong Internal controls and its consistent
implementation only can be helpful to bring the risk
factors to the acceptable level.
Keywords :
Internal Controls, Governance, Risk Factors, Control Breakdown, Internal Controls Over Financial Reporting, Fraud Deterrence, Management Override
The success of any business solely depends on
the controls and processes adopted and implemented by
the business units. In the ancient times, the businesses
were conducted on judgemental basis, which purely
individual driven. The concept of collective efforts were
not felt and accordingly the merits and de-merits both
were witnessed related to those business ventures. As a
pinch of autocracy was dominating in those businesses, the
employees were considering the employment only as a job
for their earnings. But the modern management thoughts
takes the business to a different direction whereby
democratic participation of all the stakeholders are the
need of the hour and hence the management had to take a
paradigm shift in the way the businesses were directed.
The qualitative elements of the business are of high
priority in the current world, which triggers the need to
have greater economy, high employment growth and
delighted customers, for which strong risk management
processes must be embraced. In order to ensure,
consistency in terms of risk reduction, appropriate tools
ought to be designed and implemented by the Top
Management of the business houses and ultimately the
Internal controls serve as these tools. The robust controls
implemented at all levels of the business will be directing
towards a qualitative operations, presiding financials, and
sturdy compliances. The controls will be strengthening the
base of the operations which will further usher the cash
flows which are the foundation for business sustainability.
The control mechanisms will be leading to achieve high
persistency in terms of revenue and profitability growth
for the entity, as the productivity will be at the higher end
and the risks at the lower end. Any breakdown of controls,
may lead to an organizational collapse, as it will be
activating the fraudulent practices from the top to bottom.
Hence strong Internal controls and its consistent
implementation only can be helpful to bring the risk
factors to the acceptable level.
Keywords :
Internal Controls, Governance, Risk Factors, Control Breakdown, Internal Controls Over Financial Reporting, Fraud Deterrence, Management Override