"Internal control Systems are the policies and procedures", practices and organizational structures, designed to provide reasonable assurance that business objectives will be achieved and that undesirable events prevente

The Information Systems Control and Audit Association (ISACA) has defined the Internal Control Systems as, "The policies and procedures, practices and organizational structures, designed to provide reasonable assurance that business objectives will be achieved and that undesired events will be prevented or detected and corrected". For effective implementation of the internal control system, the followings are pre-requisites: There should be clear division of the work. Segregation of the work should be in such a manner that the work done by one person is the beginning of the work for another person. There should be the clarity of the responsibility. The work flow process be documented or standardized so that the staff may perform the work as suggested in the work flow chart. No single persons should be allowed to have access or control over any important business operation. There should be rotation of the staff duties periodically. Staff should be asked to go on mandatory leave periodically so that other person may come to know if someone is playing foul with the system. Persons having the charge of the important assets should not be allowed to have access to the books of accounts. Periodical inspection of the physical assets be carried out to ensure its physical existence as well in good working conditions. The valuable items like cash and others, to be physically inspected and the periodicity of investigation should be at irregular intervals, so that the person under whose charge the assets are, cannot know in advance, when the inspection will took place and manage the affairs.