CIMA P3 Syllabus C. Internal controls - Internal Controls Importance - Notes ^{5 / 21}

Importance of internal control

1. Underpins investor confidence

2. Risks would not be known about and managed without adequate internal control

3. Helps to manage quality

4. Provides management with information on internal operations and compliance

5. Helps expose and improve underperforming internal operations

6. Provides information for internal and external reporting

However, internal control systems are only as good as the people using them.

No system is infallible

Responsibility for internal control is not simply an  executive management role.

Though they should set the tone

All employees have some responsibility for monitoring and maintaining internal controls