“Internal control is at the heart of accountability for
our nation’s resources and how effectively government uses
them,” the Government Accountability Office has said
following testimony on the implementation of revisions
to the Office of Management and Budget’s circular A-123.
It highlighted the need for “supplemental guidance and
implementation tools; vigilance over the broader range of
controls covering program objectives; strong support from
managers throughout the agency, and at all levels;
risk-based assessments and an appropriate balance between
the costs and benefits of controls; management testing of
controls in operation to assess if they are designed
adequately and operating effectively; and management
accountability for control breakdowns.”
Internal controls are an organization’s plans, methods
and procedures protecting against errors, fraud, waste,
abuse and mismanagement, according to GAO-05-321T.
The controls have developed over time, notably with
passage of the Federal Managers’ Financial Integrity Act
in 1982. In 1989, GAO said it concluded that while internal
control was improving, “the assessment and reporting
process itself appeared to have become the endgame.”
GAO said it supports OMB’s changes to the circular, “in
particular the principles-based approach for establishing
and reporting on internal controls.”
