Question

What would be the disadvantages, potential weaknesses and costs of internal controls?

Answer 1

Internal control means controlling the cost of company internally or doing auditing of the company’s work internally. This has few limitations as well:-

• Time consuming

Controlling the work internally will increase the cost of labor and company need to hire more people in the company to perform activity. Which will result in delay in the work and client will receive the final product late.

• Human error

A person involved in a control system could simply make a mistake, perhaps forgetting to use a control step. That way the plan of controlling the things get failed and that will harm the performance of the company.

• Difficulty in understanding

Some times it may happen that the people will face issue with the controlling the thing because they are not able to understand the same. The issue could because people to whom the responsibility is given are not able to understand the role they have to play.

• May increase the frustration in the employees

No one like the auditing of his/her work. So employees may get frustrated with the same and may plan to leave the jobs which will harm the performance of the company.

These are few disadvantages of the Internal control which every company will have to face.