A mitigating control is type of control used in

auditing An audit is an "independent examination of financial information of any entity, whether profit oriented or not, irrespective of its size or legal form when such an examination is conducted with a view to express an opinion thereon.” Auditing ...

to discover and prevent mistakes that may lead to uncorrected and/or unrecorded misstatements that would generally be related to control deficiencies. For example, a Company's

financial accounting Financial accounting is the field of accounting concerned with the summary, analysis and reporting of financial transactions related to a business. This involves the preparation of financial statements available for public use. Stockholders, s ...

may fail to record a

financial transaction A financial transaction is an agreement, or communication, between a buyer and seller to exchange goods, services, or assets for payment. Any transaction involves a change in the status of the finances of two or more businesses or individuals. A ...

and the error may go unnoticed for several reporting periods. A mitigating control would be instrumental in finding and therefore, preventing such mistakes. If a key control fails and a mitigating control is in place, it may prevent the resulting potential financial statement error from becoming material.

References

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