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Principle 12.1-12.2 report.docx - Principle 12 is on...

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Principle 12is on strengthening the internal control system and enterprise riskmanagement framework. This principle states that to ensure integrity, transparency andproper governance in the conduct of its affairs, the company should have a strong andeffective internal control system and enterprise risk management framework.Recommendation 12.1Let us first define what an internal control system is.Internal controlsare the mechanisms, rules, and procedures implemented by acompany to ensure the integrity of financial and accounting information, promoteaccountability, and prevent fraud.An Effective Internal Control System Embodies:Management oversight-First, internal control has its management oversight this is toensure that an adequate system of internal controls isestablished andmaintained.Mahalaga yung management oversight para mamaintain ng isang companyyung control na meron sila sa isang system or sa buong company.Next is one of the essential element of an effective system of internal control is a strongcontrol culture. Through the board of directors and senior management control cultureis emphasized by showing the importance of internal control through their actions andwords. This includes the ethical values management displays in their business dealings,both inside and outside the organization.Therisk recognition and assessment processis a critical part of effectivelymanaging risks or events as part of an organization’s operational risk. First inidentifymuna yung risk, and then classify siya by risk category. Inaasses yung isang risk basedsa impact, and then parang nirarank nila yung mga risk na yon para malaman kung anoyung uunahin na bigyan ng solution.

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Term
Spring
Professor
N/A
Tags
Management, Internal Control System

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