The Importance Of The Internal Control Environment, From The French Bank Societe Generale Case

The Internal Control Environment consists of all the factors relevant to the framing and implementing of internal control system, which is the basic of other internal control factors. Nowadays there are more and more fraud cases appeared in our life. In these cases, the internal control environment deficiency proved to be the most important cause, which led to the failure of the internal control. This paper analyzes the Societe Generale Case, and come up with such a conclusion: as the basic of the internal control, the internal control environment acts as a very important role. A faulty internal control environment may cause the failure of the implementation of an internal control system, even though this system may be perfect. At last, the paper gives some advises on how to reconstruct the control environment, which will improve the effectiveness and reliability of internal control and reduce the operating risk.This paper is divided into four sections: the internal control and internal control environment theory; analysis of the Societe Generale case; conclusion and recommendation.