Xacc 280 Week 8 Internal Controls

In the industry of accounting, organizations seem to need a system put into place for them that will reduce (or possibly eliminate) fraud. Every business must have some way to protect its resources, both physical and intangible. This system is called an internal control. Internal controls are designed to help the organization accomplish goals and objectives without hindering the normal workflow of day to day business.

There are two main organizations that regulate financial accounting in the United States. These two are: The Public Company Accounting Oversight Board, and The Financial Accounting Standards Board. On a global scale, financial accounting is controlled by the International Accounting Standards Board. These organizations help keep internal controls in check in an effort to reduce fraud. (Cliff Notes)

The Public Company Accounting Oversight Board (or PCAOB) is a regulatory body for auditing. The PCAOB is a private, non-profit corporation. PCAOB was created by the Sarbanes-Oxley Act in 2002, under U.S. Federal law to oversee auditors of public companies. PCAOB serves to “protect the interests of investors and further the public interest in the preparation of informative, fair, and independent audit reports.” PCAOB regulates companies by providing an audit that is not performed by internal company personnel. (Cliff Notes)

The Financial Accounting Standards Board (FASB) has been a designated organization in regulation since 1973. The FASB is also a private organization, much like the PCAOB, and establishes accounting standards, as well as standards for financial accounting and reporting. (Cliff Notes)

On the global scale, the International Accounting Standards Board (IASB) is the primary regulatory body. The IASB is an independent, privately-funded organization which sets the standards for global financial accounting. The IASB is located in London, UK, and is an organization committed to developing a single set of high quality, understandable,...