The relationship between internal control procedures and standards and risk management: an applied study on contracting companies

Abstract

The risks to which economic units are exposed are considered among the dangerous phenomena that, if they occur, cause a waste of money and a threat to the development and development plans that are to be implemented in order to achieve the goals they have set. The internal control system is an essential means that works for the purpose of reducing the amount of risks that may be exposed to. By developing it, defining its duties, and setting a structure to explain its concepts, procedures, and competencies to increase the ability to evaluate the unit’s activities and know the extent to which it can be relied upon in mitigating and controlling the risks expected to occur. All of this is done under the supervision of senior management, which works to support the work of this system by providing all qualified competencies. Scientifically and practically, which is needed for oversight work to reduce risks.

Internal control tasks have also developed during the last two decades of the twentieth century, and one of the most prominent of these developments is managing the risks of the economic unit through internal control, which means the possibility of predicting business risks, determining their impact, and informing management to develop appropriate strategies and policies to reduce the impact of risks to a minimum. A questionnaire was distributed. For the purpose of testing the hypothesis using statistical analysis, the hypothesis was accepted through the correlation test, as the simple linear correlation coefficient reached (0.779), which indicates the strength of the relationship between the variables.