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

financial audit A financial audit is conducted to provide an opinion whether "financial statements" (the information is verified to the extent of reasonable assurance granted) are stated in accordance with specified criteria. Normally, the criteria are interna ...

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 or Attitude may refer to: Philosophy and psychology * Attitude (psychology), a disposition or state of mind ** Attitude change * Propositional attitude, a mental state held towards a proposition Science and technology * Orientation ...

awareness In philosophy and psychology, awareness is the perception or knowledge of something. The concept is often synonymous with consciousness. However, one can be aware of something without being explicitly conscious of it, such as in the case of bli ...

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 organizations, whether businesses, nonprofit organizations, or a Government agency, government bodies through business administration, Nonprofit studies, nonprofit management, or the political s ...

(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 broa ...

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

corporate culture Organizational culture encompasses the shared norms, values, corporate language and behaviors - observed in schools, universities, not-for-profit groups, government agencies, and businesses - reflecting their core values and strategic direction. ...

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

philosophy Philosophy ('love of wisdom' in Ancient Greek) is a systematic study of general and fundamental questions concerning topics like existence, reason, knowledge, Value (ethics and social sciences), value, mind, and language. It is a rational an ...

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.

References

Auditing Internal audit {{business-stub

See also

References