Internal controls are designed to provide a reasonable assurance that goals and objectives for the University and administrative areas will be met. Here are just a few examples of internal controls:
- Compliance with Federal and State regulations, and compliance with Monmouth University’s policies and practices to ensure directives are carried out and goals of the department and the University are attained
- Ensure reliability of financial reporting
- Safeguarding Monmouth University’s assets and adequately mitigate risk
- Ensure operations are running effectively and efficiently
- Promoting efficiencies among operational procedures
Two types of controls:
- Preventative Controls: These are established to avoid undesirable circumstances and to maintain compliance with approved policies and procedures in both financial and operational areas within Monmouth University (example: obtaining proper signatures for purchasing approval)
- Detective Controls: Not as desirable as preventative controls but useful nevertheless, detective controls are designed to identify irregular transactions or improper procedural events after they’ve occurred (example: a review of expenditure reports to ensure all purchases were legitimate)
The administrative processes within Monmouth University rely on internal controls to remain in compliance with internal and external requirements. Without adequate internal controls, functions within Monmouth University would be non-compliant, inefficient, too costly to operate, and ultimately fail. Adequate controls to mitigate risks need to exist in everyday business procedures.