Framework

Preventive, detective and corrective controls

The question it answers

After an error or fraud exposes a weak process, which mix of preventive, detective and corrective controls should a finance manager put at each step?

Origin
COSO (2013)
Diagram type
Comparison table
Level of analysis
Firm
Topics
Ethics & corporate governance
Clay balance scale with two level glass pans, icon for business ethics

Diagram

Preventive, detective and corrective controls

CriterionPreventiveDetectiveCorrective
TimingBeforeAfterAfter detection
ExamplesSegregation of duties, approvals, access rightsReconciliations, audits, management reviewProcess redesign, retraining, adjusting entries
WeaknessCan be bypassed by override or collusionComes lateDepends on follow-through

Sources

References

Listed A–Z by author surname, Harvard style. A source with a DOI links to https://doi.org/…; one without links to its page or says plainly that it has no DOI.

  1. Committee of Sponsoring Organizations of the Treadway Commission (2013) Internal Control – Integrated Framework.No DOIcoso.orgSource page