The basic objectives of the internal financial control system are to ensure the efficiency and effectiveness of the unit's operating activities, the security of assets, the reliability of operating information and financial reports.
Internal financial control refers to the management at all levels of a unit, in order to protect the safety and integrity of its economic resources, ensure the correctness and reliability of economic and accounting information, coordinate economic behavior, control economic activities, and utilize the mutual constraints generated by the division of labor in the unit. The interconnected relationship forms a series of methods, measures, and procedures with control functions, which are standardized and systematic, making it a tight and relatively complete system. Here are 7 principles for designing financial internal control.
7 Principles in the Design of Financial Internal Control
1 --- The principle of legitimacy means that an enterprise must take the laws and regulations of the country as the criterion and, within the scope of national rules and regulations, establish a practical financial control system for the enterprise.
2 --- The principle of pertinence refers to the establishment of an internal control system based on the actual situation of the enterprise and the establishment of a practical and effective internal control system for the weak links in the company's financial and accounting work. The various links and details are effectively controlled to improve the enterprise. Financial accounting level.
3--Integrity principle means that the financial internal control system of an enterprise must fully involve the control of all aspects of the company's financial and accounting work. It must conform to the long-term planning of the enterprise and pay attention to the short-term goals of the enterprise. The other internal controls are coordinated.
4--Consistency principle means that the financial internal control system of an enterprise must have continuity and consistency.
5 --- The principle of adaptability means that the internal financial control system of an enterprise should be timely supplemented with the internal financial control system of the enterprise according to the changed circumstances of the enterprise and the development of the financial accounting profession and social development.
6 --- Developmental principles. When formulating the internal financial control system of an enterprise, it is necessary to fully consider the macro policies and the development of the enterprise, closely observe the movements of competitors, and formulate developmental or future-oriented rules and regulations.