Financial Management and Control
Implementation of Financial Management and Control (FMC) system is the part of Public Internal Financial Control reform and the aim of it is to reach the goals of institution effectively and efficiently. Managerial Accountability system should ensure the distribution of powers and responsibilities within the institution. Subsequently, managers of each hierarchic levels of institution should be accountable to the superior manager, within their competence.
Financial Management and Control is based on international internal control standards and shall be exercised by means of the following interrelated components:
a) control environment;
b) risk management;
c) control activities;
d) information and communication;
e) monitoring and evaluation.
COSO
Internal control helps entities achieve important objectives and sustain and improve performance. COSO’s Internal Control – Integrated Framework (Framework) enables organizations to effectively develop systems of internal control that adapt to changing operating environments, mitigate risks to acceptance levels, and support sound decision making and governance of organization.
An effective system of internal control demands more than rigorous adherence to policies and procedures: it requires the use of judgment. Management use judgement to determine how much control is enough. Management and internal auditors, among other personnel, apply judgement as they monitor and assess the effectiveness of the system of internal control.
The Frameworks assists management and others interacting with the entity in their respective duties regarding internal control without being overly prescriptive. It does so by providing both understanding of what constitutes a system of internal control and insight into when internal control is being applied effectively.
Three line model
FMC Champion
