An internal audit control system is a common safeguard found in business today. This safeguard is broken down into two parts: internal audits and internal controls. Internal audits are informal reviews by the business owner or employees. They provide information on internal operations in employee performance. Internal controls represent the specific policies the business owner, manager and employees must follow in the business. Internal audit control systems have a few weaknesses that business owners must address.
Internal audit control systems can be very broad in their application and this can create a weaker internal audit control system. Business owners should attempt to develop a system that focuses on specific business issues. Control systems that cover too many business departments or functions may not produce the maximum benefit for companies. Control systems should contain a few well-defined policies for each department. This also allows operational managers and employees to help the business owner maintain the focus on proper application of the control system policies.
Creating internal safeguards is often a time consuming process. Business owners may also face the disadvantage of learning about control systems while working in the business. Internal audit control systems can also be time consuming for owners and managers to maintain. Time-consuming safeguards may cause managers and employees to find ways of getting around the control system. This weakness can create difficult management situations for owners attempting to maintain proper business practices. Business owners may also be unable to dedicate the time needed to review extensive internal audit control systems.
Lack of Knowledge
Business owners may be unaware of the best internal control audit systems to implement in the company. This lack of knowledge makes it difficult