A control environment, also called "Internal control environment", is a term of financial audit,

internal audit Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach t ...

and

Enterprise Risk Management Enterprise risk management (ERM) in business includes the methods and processes used by organizations to manage risks and seize opportunities related to the achievement of their objectives. ERM provides a framework for risk management, which typi ...

. It means the overall

attitude Attitude may refer to: Philosophy and psychology * Attitude (psychology), an individual's predisposed state of mind regarding a value * Metaphysics of presence * Propositional attitude, a relational mental state connecting a person to a prop ...

awareness Awareness is the state of being conscious of something. More specifically, it is the ability to directly know and perceive, to feel, or to be cognizant of events. Another definition describes it as a state wherein a subject is aware of some info ...

and actions of

directors Director may refer to: Literature * ''Director'' (magazine), a British magazine * ''The Director'' (novel), a 1971 novel by Henry Denker * ''The Director'' (play), a 2000 play by Nancy Hasty Music * Director (band), an Irish rock band * ''D ...

and

management Management (or managing) is the administration of an organization, whether it is a business, a nonprofit organization, or a government body. It is the art and science of managing resources of the business. Management includes the activities ...

(i.e. "those charged with governance") regarding the

internal control Internal control, as defined by accounting and auditing, is a process for assuring of an organization's objectives in operational effectiveness and efficiency, reliable financial reporting, and compliance with laws, regulations and policies. A bro ...

system and its importance to the entity. They express it in management style,

corporate culture Historically there have been differences among investigators regarding the definition of organizational culture. Edgar Schein, a leading researcher in this field, defined "organizational culture" as comprising a number of features, including a ...

values In ethics and social sciences, value denotes the degree of importance of something or action, with the aim of determining which actions are best to do or what way is best to live (normative ethics in ethics), or to describe the significance of dif ...

, philosophy and operating style, the

organisational structure An organizational structure defines how activities such as task allocation, coordination, and supervision are directed toward the achievement of organizational aims. Organizational structure affects organizational action and provides the founda ...

, and

human resources Human resources (HR) is the set of people who make up the workforce of an organization, business sector, industry, or economy. A narrower concept is human capital, the knowledge and skills which the individuals command. Similar terms include ...

policies Policy is a deliberate system of guidelines to guide decisions and achieve rational outcomes. A policy is a statement of intent and is implemented as a procedure or protocol. Policies are generally adopted by a governance body within an orga ...

and procedures.

External links

IFAC Represents 2 500 000 accountants in 120 countries
Auditing Internal audit {{business-stub

See also

External links