Risk Management and Internal Controls: FRC’s Risk Guidance

Abstract

The Turnbull Report was first published in 1999 and set out best practice on internal control for listed companies. In October 2005 the Financial Reporting Council (FRC) issued an updated version of the guidance with the title 'Internal Control: Guidance for Directors on the Combined Code. This was superseded by the FRC's Risk Guidance 2014. In this article board responsibilities for risk management and internal controls, exercising the risk management and internal controls, monitoring and review of the risk management and internal controls, related financial and business reporting under new FRC guidance are examined. As a conclusion it is emphasized that integrating risk management and internal controls may benefits to the organization by creating competitive advantage.