Financial Controls, an Old Function in a New Role
Keywords:
Auditing, Financial controls, Financial stability, Globalization, RegulationAbstract
The phenomenon of financial controls is as old as money. The ancient rulers wanted to know if their subordinates gave an accurate
report on how the tax revenues was spent. Traders in Lombardy wanted to be ensured that their employees had not cheated. The
owners of joint stock companies are also curious whether the board that leads the company and the managers act in the owners'
interest when managing the company. I believe that the appearance and consolidation of the financial system, which is without
internal values and based on trust, and the increasing need for financial stability have given increasing role to financial controls.
The global financial crises in the third part of the 1990's has resulted a new situation in the operation of the international financial
system. It has been pointed out that financial stability can only be guaranteed by global regulation and control, supervision and
audit. Financial controls have been put in a new position qualitatively due to the development of the uniformed controlling
procedures and the internationally co-ordinated operation of institutions. It cannot be ruled out that financial controls will be the
generator and creator of global co-ordination. This article tries to discuss the arguments of this hypothesis as well as present some
data supporting it.
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