What is documentation of internal control?

What is documentation of internal control?

Internal control documents in a company

Document control is a requirement that establishes the basis for developing, maintaining and updating the documentary support of quality management systems and is gradually being widely implemented in various companies around the world. However, many people find it difficult to define it clearly and effectively.

Document control is like a management system whose purpose is to enforce processes and practices for the creation, review, modification, issuance, distribution and accessibility of documents.

We can also say that document control is a set of measures taken to regulate the preparation, review, approval, publication, distribution, access, storage, security, alteration, change, withdrawal or disposition of documents. In other words, everything about documents.

ISO 9001 is a quality management system (QMS) standard that focuses on all the elements of quality management that an organization must have in order to have an effective system to manage and improve its products and services.

Example Internal Control Narrative

Because information in document form drives nearly every action in any organization, the ability to control this information usually means the difference between success and failure. Therefore, document control remains the most critical quality assurance discipline.

As with many other systems, document control is most successful if it is simple, intuitive and easy to use. And the first step toward this end is to decide exactly which documents should be controlled.

Document control is among the most critical tools for compliance in highly regulated industries. Organizations at every stage of the lifecycle can benefit, from startups to organizations approaching market approval.

Read more  What are collateral documents in real estate?

A document control system supports regulatory compliance records management and quality management systems for documentation. Document control software systems support paperless process automation, quality document management, such as non-conformance reports, and audit trails.

Control of internal and external documents

In the development of the audit process it is essential to carry out an organized management of accounting documents, in order to abbreviate the contents, procedures and conclusions, thus specifying the scope of the procedures performed and streamlining the security processes, in order to apply procedures, actions and decisions quickly and integrally. Documentation is a primary evidence in the audit process, being fundamental to support recorded operations. Therefore, it is the auditor who accepts a document as reliable evidence, when he considers that it was processed and created using a good internal control structure, or on the contrary, rejects it when he cannot consider a document as reliable evidence. In addition, and in the case of the development of an external audit, the auditor tends to consider more secure the acceptance of an external document, given that they have been under the control of a client and other parties to the operations, which means that both are in agreement with the information and conditions indicated therein. By judiciously following this process, it is possible to show the client that the results of the audit process have been satisfactory and legitimate.

Elements of internal control

It begins with the formal commitment of the Top Management and the constitution of a Committee responsible for conducting the process. It also includes actions aimed at formulating a diagnosis of the situation of the entity’s internal control system with respect to the internal control standards established by the CGR, which will serve as the basis for the preparation of a work plan to ensure its implementation and guarantee its effective operation.

Read more  How do you review a document and provide feedback?

It comprises the development of the actions foreseen in the work plan. It takes place at two sequential levels: at the entity level and at the process level. At the first level, the control policies and regulations necessary to safeguard the institutional objectives are established within the framework of the internal control standards and the components they establish; while at the second level, based on the entity’s critical processes, after identifying the objectives and the risks that threaten their fulfillment, the existing controls are evaluated to ensure that they ensure that the response to the risks that management has adopted is obtained.