The purpose of the new Institute of Internal Control ™

What is needed within the field of accounting is a firewall between the scorekeeping, or accounting, function and the performance itself. Picture an Olympic figure skating competition. The athlete performs, sits down and then awaits his or her score. When the scores are posted, the skater simply must accept them. They do not typically protest; “Hey, we need to change the rules! Hey, cut me some slack here! Just because I fell down, that should not count against me! We should change the rules to allow one fall in the short program and two falls in the long program. Then we need to post the scores without the fall-downs!” As asinine as this example sounds, this is what investors have become accustomed to in the field of external financial reporting. The accounting and audit rules allow this because they are vague. What is needed is a detailed methodology like the Comprehensive Internal Control Methodology™ presented in my book Practical Guide to Internal Control and taught in my seminars. With this methodology, companies, that wish to do so, can implement internal controls that prevent the manipulation of the accounting results and keep the firm's operational executives focused on the operational performance of the company.

The purpose of the new Institute of Internal Control™ is to go beyond traditional accounting and auditing to develop tools and methodologies that companies can use to form an impenetrable barrier between a company's score-keeping function and the operational management that would seek to manipulate the financial results.

Become a Founding Member of the Institute of Internal Control ™
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