INTERNAL CONTROL IN AN EXAMINING BODY- A CASE STUDY OF THE NATIONAL EXAMINATION COUNCIL, ENUGU ZONAL OFFICE
Background of the study:
Internal control was defined by the Auditing standards and guideline as a whole system of control both financial and otherwise, established by management in order to carry on the business of on enterprise in an orderly and efficient manner, ensure adherence to management polices, safeguard the asset and secure as far as possible the completeness and accuracy of records.’’(1) In reality, internal control form the bedrock of auditing both from the point of view of management and the auditor, its objectives being the prevention or early detection of fraud and errors. It may include internal auditing which qualifies as part of the system of internal control and it is designed for the following reasons:
(a) To enforce financial and other control:
(b) Ensure adherence to management policy
(c) Help to safeguard the assets (cash)
(d) To ensure the accuracy and reliability of the records
(e) Help to ensure orderliness in the business and
(f) Help in the prevention and early detection of fraud and errors.
An artificial review of the change in the Accounting practice will depict the essence of internal control system in an organization especially in an examining body.
The earliest known form of accounting, which is stewardship, Accounting started as far back as 450 B.C. This form of accounting involves the orderly recorded of business transaction by person appointed by the landlord to serve as a stewards for them. This was later changed as the recording remained primitive stewardship accounting pave may to financial accounting during the nineteenth century which marketed the era of industrial revolution”. This indeed led to the advent of joint stock companies- a situation where by group of individuals contributed capital in exchange for shares in the asset and profits of the company sea bubble of 1720, had earlier on instilled fear and suspicion in the mind the public that they doubt the ability of the directors to carry out this type
of trade honestly. Management accounting however, is not le but for it is another aspect of accounting that got it authority and ground from the historical recording and analysing role of accounting to emphasizing detailed information for internal planning, control and decision making. Currently most business are operated by limited liability companies which are owned by their share holders, but managed by the directors appointed by them.
In the same vein, the public corporation and establishment, and even examining bodies are owned by the public but under the management of appointees.