ADMINISTRATIVE REPORTING FOR INTERNAL CONTROL SYSTEM

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ADMINISTRATIVE REPORTING FOR INTERNAL CONTROL SYSTEM

Journal Title: The Institute of Accounting, Control, and Analysis in the Globalization Circumstances - Year 2016, Vol 3, Issue 3

Abstract

Introduction. One of the sources of information for the internal control is internal reporting of the enterprise that provides managers with the necessary data for management, deviations and shortcomings of financial and economic activities and creates leverage feedback effect on controlled objects. It is worthwhile to note that today, the question of the content of the internal reporting remains controversial because its content is not regulated, and the ratio of the financial and internal reporting depends on the conditions of activity of economic entities and management traditions leadership in this matter. Methods. The following general scientific and special methods of investigation are used in the study. In particular, the abstract and logical method is applied in theoretical grouping and theoretical formulation of conclusions; historical, empirical and observation methods are used in determining trends in the implementation of the forms of internal statements in the system of consumer cooperatives and the shortcomings in the regulatory and legal regulation of these processes; scientific generalization is used in the process of developing proposals for the use of internal reporting for rational construction of internal control system; systematic and comparative analysis to identify trends and changes concerning the internal controls and indicators that characterize its effectiveness. Results. The article summarizes theoretical research achievements of domestic and foreign scholars concerning the role of information presented in internal accounting reports for a rational organization of internal control. It is substantiated the need for reliable display of the results in financial statements in order to evaluate the efficiency of the internal control system. Scientifical substantiationof the role of internal reporting in order to create an effective system of control and determination of the effectiveness of the internal control of an enterprise and its employees, is considered in the article. The abstract logical, historical, empirical, observation, scientific generalization, systematic and comparative analysis methods are used to identify trends in the introduction of internal reporting and its use in the control research. Internal reporting is considered as an important information resource that reflects the performance and results of operations for a company as a whole and in the context of its structural units, which is necessary for decision-making. The paper exposes the order of grouping and filling in forms of interdepartmental reporting for enterprises and organizations of consumer cooperation in Ukraine and it explains their informational value for the purposes of control. The attention is drawn to specialized reporting forms used by cooperative enterprises, reflecting the results of internal control. It is proposed to supplement the reporting on auditing work with information revealing the number of planned and conducted audits and persons involved in them, the number of measures taken to eliminate detected violations in order to determine the efficiency of control units’ employees. Discussion. Further researches will be focused on studying the factors, criteria and methods of evaluating the effectiveness of internal control system using indicators of internal reporting.

Authors and Affiliations

Roman Voronko

Keywords

EP ID EP184818
DOI -
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