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Internal Control Frameworks Compliance Models. Internal Controls Essay

Internal Control Frameworks Compliance models. Internal controls are processes that are designed to offer reasonable levels of assurance that objectives can be met in several important areas, including the reliability and security of financial reporting, the efficiency and effectiveness of operations, and legal and regulatory compliance. Many versions of compliance models exist that can serve as the foundation for organizational compliance initiatives. These compliance models are more suitable for certain industries than for other industries. The following description explores two compliance models and identifies relevant industries in which the models could be successfully employed.

Domain model for internal controls compliance. A close relation exists between business process management (BPM) and internal controls management (Namiri & Stojanovic, 2007). The process of constructing the architecture between the two entities entails identification of the significant accounts in the company and identification of the business processes...

Control objectives are identified for each business process and the risks that the enterprise faces are linked to relevant control objectives (Namiri & Stojanovic, 2007). When the domain model has been designed and executed based on the risk assessment, the set of controls will prevent or detect the occurrence of the identified risks (Namiri & Stojanovic, 2007). The domain model is appropriate for any business enterprise that is subject to the Sarbanes-Oxley Act (SOX), particularly where database technology is utilized.
CobiT framework model for internal controls compliance. The IT Governance Institute's Control Objectives for Information and related Technology (CobiT) is a commonly used framework for achieving compliance (Pabrai, 2006). The model is comprehensive and utilizes controls designed to ensure that business practices and regulatory requirements are aligned (Pabrai, 2006). The CobiT framework is a turnkey model that assures compliance readiness as regulations change…

Sources used in this document:
With studies showing that well-governed companies pay off handsomely for shareholders, CPAs can help their employers benefit from the lessons learned by companies that approached Sarbanes-Oxley compliance as a stepping-stone to more comprehensive improvements. These entities upgraded technology and business processes and took the opportunity to change how the company functioned; new methods of doing business frequently result in cost savings.

(Harrington, 2005)

Control environment. Advising managers to implement preventative and detective controls across the enterprise, which would include segregating access to inventory, fixed assets and purchases, and cash
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