types of internal controls in accounting
Types of Internal Controls in Accounting. The Worldcom, Enron and HealthSouth accounting scandals, among others, have heightened the importance of internal controls for companies everywhere. The Sarbanes-Oxley Act mandates that companies develop and maintain adequate internal control systems. In the U.S., internal controls are evaluated in the context of the Committee of Sponsoring Organizations (COSO) framework. There are three types of internal controls: Preventive, Detective and Corrective. In order to gain an understanding of the internal control concept, it is necessary to have a basic understanding of the COSO framework.