Study Of Government Internal Controls - Based On COSO Internal Control Framework

More attention are paid to the problems such as fraud, waste, abuse, and misgovern happened in some government agencies as more and more Announcement of Audit Findings are disclosed and people get more and more information about government agencies operations. In order to improve the government agencies'internal controls system, and to provide reasonable assurance that the government agencies'fulfilling accountability obligations as well as executing orderly, ethical, economical, efficient and effective operations, we turn to COSO internal control– integrated framework.COSO internal control– integrated framework is widely known and accepted internationally, it consists of five interrelated components which are control environment, risk assessment, control activities, information communications, and monitoring. In private sector, the SOX act in U.S. and the Enterprise Internal Control Basic Standards in China have adopted COSO internal control– integrated framework. In China, the enterprise internal control practices are ahead, and the government internal control are under development referenced to the best practices in the enterprises. Based on the Principal-agent Theory, cybernetics and system theory, and taking COSO internal control– integrated framework as standards, taking lessons from the enterprises internal control practices, we analyze the internal control situation in government agencies and provide the roadmap and suggestions to develop China government agencies'internal control systems.