The need for Internal Control System and External, Error, Fraud and Irregularity Audit provided from outside the company has been inevitable since their senior management cannot directly dominate the entire business organization from the center.
The main factor that distinguishes cheating and irregularities from error is whether the act that caused the mistake in the financial statements was deliberately made. An error refers to inaccuracies made in the financial statements, such as bypassing an amount or a statement.
Fraudulent financial reporting is deliberately misleading users of the financial statements by not including or misrepresenting the amounts or disclosures required in the financial statements.
Early detection of errors in a company and a strong anti-fraud system will increase public authorities', investors, members of the audit committee, and the community in general, in the company and its financial statements. It will also help the company to generate capital costs under more favorable conditions. The operation of this system also depends on the following criteria.
- An effective senior management policy,
- Establishing an internal audit committee,
- To carry out effective studies with external audit firms,
- A strong internal control structure,
- A business ethics policy that every employee will accept,
- A cultural policy to be created in the enterprise,
- Human resources management to ensure that honest persons are recruited,
- Providing an open and honest working environment,
- Aid programs for employees,
- Training of employees especially on cheating,
- A clear fraud penalty policy,
- Establishing a system that will ensure the flow of information within the enterprise,
- Establishment of cheating policy and procedures regulations.
As a result, as businesses grow and become more complex, internal control becomes more important. The opportunities of senior managers to have direct information about business activities are decreasing. Therefore; It is important to set up and operate an effective and continuously renewable internal control system that will minimize errors, cheats, extravagance and corruption, increase efficiency, ensure accurate, reliable reports at the right time, and comply with the structure and size of the business.
Key is ready to provide all kinds of support during the establishment of the internal control system, error cheating and irregularity auditing and reporting processes.