Ifac backs greater internal control

News Article - 24 May 2012
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A new report highlighting the role of internal control in enhancing corporate governance has been released by a major accounting body.

The International Federation of Accountants (Ifac) publication examines the growing role of internal control as a means of minimising business risk and protecting shareholder investments.

It also identifies the importance of the culture and ethical framework throughout an organisation to its effective implementation of an internal control system.

Accounting guidance and regulations around the world have focused on the development and strengthening of internal control systems in recent years.

"Professional accountants play an important role in supporting the internal control systems of their organisations," said Bill Connell, chairman of Ifac's professional accountants in business (PAIB) committee.

"This new paper describes much of the current thinking on internal control from countries around the world and is the first step in the PAIB committee's programme to develop practical guidance on internal control."

The paper builds on the findings of a 2004 report that Ifac produced with the Chartered Institute of Management Accountants.

That study found that companies must strike a balance between conformance with rules and organisational performance.

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