Disclosure of Internal Control Systems: A Cross-Sectional Study of Listed Finnish Companies.
NGALEU, NACHIDAH (2011)
2011
Yrityksen taloustiede, laskentatoimi - Accounting and Finance
Johtamiskorkeakoulu - School of Management
This publication is copyrighted. You may download, display and print it for Your own personal use. Commercial use is prohibited.
Hyväksymispäivämäärä
2011-06-29
Julkaisun pysyvä osoite on
https://urn.fi/urn:nbn:fi:uta-1-21672
https://urn.fi/urn:nbn:fi:uta-1-21672
Tiivistelmä
An Internal Control is a process carried out by an entity’s Board of Directions, management and other personnel, designed to provide reasonable assurance regarding the achievement of its objectives. Its goal is to ensure the effectiveness and efficiency of operations, the reliability of financial reporting as well as compliance with applicable laws and regulations. The accounting scandals that occurred in the U.S. in the early 2000’s has a tremendous impact on investments and the economy and thus triggered a lot more research in the field of internal controls worldwide. Studies in the field have looked at internal control from a variety of perspectives, touching aspects such as compliance with regulations, implementation of controls, the impact of internal controls on reliability of financial information as well as their impact on overall performance of organizations.
The purpose of this research is to assess how listed Finnish companies report their internal control. This is achieved by answering the following research questions: How do these organizations disclose their internal controls? Do they comply with applicable codes and regulations? Are there any similarities and/or differences between the reports? The empirical study will consist of carrying out an analysis of the contents of both the applicable codes to these companies and the disclosure of the internal control based on the 2009 Corporate Governance Statement. The methods used for this research include both nomothetic and action-oriented methods and a cross-sectional field study approach is used to analyse the data.
The findings of the research reveal that all companies comply. However, they seem to disclose information somewhat differently, presumably due to variations of the various Codes, differences in the interpretation of these codes, differences in the way that the controls are carried out and also given the varied natures of the Codes by which they abide. Indeed there exist differences and similarities in the disclosure styles and content. An interesting finding in this research is that the nature, the depth and the strength of the applicable codes could impact the manner in which companies report their Internal Control Systems.
Asiasanat:Internal Control, Disclosure, Compliance, Applicable Codes, Financial Reporting
The purpose of this research is to assess how listed Finnish companies report their internal control. This is achieved by answering the following research questions: How do these organizations disclose their internal controls? Do they comply with applicable codes and regulations? Are there any similarities and/or differences between the reports? The empirical study will consist of carrying out an analysis of the contents of both the applicable codes to these companies and the disclosure of the internal control based on the 2009 Corporate Governance Statement. The methods used for this research include both nomothetic and action-oriented methods and a cross-sectional field study approach is used to analyse the data.
The findings of the research reveal that all companies comply. However, they seem to disclose information somewhat differently, presumably due to variations of the various Codes, differences in the interpretation of these codes, differences in the way that the controls are carried out and also given the varied natures of the Codes by which they abide. Indeed there exist differences and similarities in the disclosure styles and content. An interesting finding in this research is that the nature, the depth and the strength of the applicable codes could impact the manner in which companies report their Internal Control Systems.
Asiasanat:Internal Control, Disclosure, Compliance, Applicable Codes, Financial Reporting