INTERNAL CONTROLS IN THE DIGITAL AGE

by Kim Throndson

Aug 19, 2025

INTERNAL CONTROLS IN THE DIGITAL AGE

Internal Controls are used in an Enterprise to manage risk.  As a business owner or manager many things need to happen in a day to earn a profit.   You need to manage the process and the risks.   Is all this still relevant in the digital age where you run your business from your phone and download everything from a portal?  Yes even more so.  Many internal controls are getting lost in the digital age, and processes eliminated.  Result:  Fraud,  bank accounts hacked, etc..  

Internal Controls improve efficiency = profit

As a Controller my job was to implement the internal controls, and the organization was audited on them.

Here are some tips:

1.       Definition

Internal controls include a variety of measures such as policies, procedures, and practices to minimize fraud, and ensure business operations are efficient and effective.

Some of the risks to mitigate are :

a.       Financial - fraud, loss of income from inefficiencies

b.        Safety – want processes to ensure a safe work space

c.       Operational – IT operations, ensuring processes in place to keep things running smoothly

d.       Reputation – customer complaints, service, and no social media fraud

2.       Portal and Cloud world

Business used to write cheques, print invoices, and file paper.   A manager would look at the paper, and say ok and sign.   Now it is all in a portal or cloud, and we have lost the check and sign.

It is still really important to look at what staff are doing, sending out, and recording.  So incorporate that check and sign digitally using one of the apps like docusign, adobe sign, or which ever one you choose.

3.       Access

Review and make a list of all the digital portals the enterprise uses. 

a.       Multiple access – some portals  used daily need a few people to have access.  Again, nowadays there is no file to pull and review should the employee not show up for work because of health or other issues.

b.       Tiered access – Some portals you may want tiered access.  Some staff have access to do some tasks, but then need a second authorizer.

c.       Owner/manager only access – higher sensitive areas like banking, social media, accounting access

4.       Document

Keep a digital operations manual, and update it regularly.  Again should an employee not show up because they have won the lottery, all their processes are documented.  Also an operations manual is a great training tool for new staff.

Summary:

Have internal controls

Digitally check and sign off

Limit access

Document

For assistance with reviewing or creating internal controls for your enterprise, contact K Consulting for an internal review.    KconsultKimthrondsonkconsult@outlook.com