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Internal Control Components: Monitoring

Updated: Dec 31, 2022


Monitoring assesses the effectiveness of the internal control’s performance over time.


The objective is to ensure that the controls are working properly and, if not, to take necessary corrective actions.


Monitoring provides feedback to management on whether the internal control system they have designed to mitigate risks is:

  • Effective in addressing the stated control objectives;

  • Properly implemented and understood by employees;

  • Being used and complied with daily; and

  • In need of modification or improvement to reflect changes in conditions.

Management accomplishes the monitoring of controls through ongoing activities, separate evaluations (including the use of an internal audit function), or a combination of these two.


Ongoing monitoring activities in smaller entities are informal and are usually built into the normal recurring activities of an entity.

This includes regular management and supervisory activities and reviewing exception reports that the information system may produce.


Where management is closely involved in operations, they will often identify significant variances from expectations and inaccuracies in financial data and take corrective action to modify or improve the control.


Periodic monitoring (separate evaluations of specific areas within the entity, such as those performed by an internal audit function in a larger company) is not common in smaller entities.


However, periodic evaluations of critical processes could be conducted by qualified employees not directly involved in those processes or by hiring an external and suitably qualified person.


Management’s monitoring activities may also include the use of information from external parties that indicates problems or highlights areas needing improvement. Examples of this could include:-

  • Complaints from customers;

  • Comments from governing bodies such as franchisors, financial institutions, and regulators; and

  • Communications relating to internal control from external auditors and consultants.

Sources of Information Used for Monitoring


The entity’s information system will produce much of the information used in monitoring.


Management may tend to assume that this information is accurate.


If this information is not accurate, there is a risk that management could reach incorrect conclusions and make poor decisions.


Accordingly, when the auditor is evaluating the monitoring of controls, an understanding is required of:-

  • The sources of the information related to the entity’s monitoring activities; and

  • The basis upon which management considers the information sufficiently reliable for the purpose.

监测评估了内部控制在一段时间内的有效性。


其目的是确保控制措施的正常运行,如果没有,则采取必要的纠正措施。


监测向管理层提供反馈,说明他们为减轻风险而设计的内部控制体系是否:

  • 有效地实现了既定的控制目标。

  • 正确执行并被员工理解。

  • 每天都在使用和遵守;以及

  • 是否需要修改或改进以反映情况的变化。

管理层通过持续的活动、单独的评估(包括使用内部审计功能)或这两者的结合来完成对控制的监测。


小型实体的持续监控活动是非正式的,通常被纳入一个实体的正常经常性活动中。


这包括定期的管理和监督活动以及审查信息系统可能产生的例外报告。


在管理层密切参与运营的情况下,他们往往会发现与预期的重大差异和财务数据的不准确,并采取纠正措施来修改或改进控制。

定期监测(对实体内特定领域的单独评价,如大公司的内部审计部门所做的评价)在较小的实体中并不常见。


然而,对关键流程的定期评估可以由不直接参与这些流程的合格员工进行,或者聘请外部有适当资质的人员进行。


管理层的监督活动还可以包括使用来自外部的信息,这些信息表明存在问题或强调需要改进的领域。这方面的例子可能包括:-

  • 来自客户的投诉。

  • 来自管理机构的评论,如特许经营商、金融机构和监管机构;以及

  • 来自外部审计师和顾问的与内部控制有关的通信。


用于监测的信息来源

实体的信息系统将产生大部分用于监测的信息。


管理层可能倾向于认为这些信息是准确的。


如果这些信息不准确,管理层就有可能得出不正确的结论并做出错误的决定。


因此,当审计师在评价对控制的监督时,需要了解

  • 与该实体的监控活动有关的信息来源;以及

  • 管理层认为该信息对于该目的来说足够可靠的依据。



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