Interne kontrolmiljøer: En empirisk undersøgelse af danske selskabers interne kontrolmiljøer set fra revisorers synspunkt

Mads Stensgaard Nielsen

Student thesis: Master thesis

Abstract

This thesis studies the internal control environments of larger Danish companies. The study is based on the theories of the 2013 COSO Internal Control - Integrated Framework (“the COSO Frame-work”) about why it is important to have a strong internal control environment. With this knowledge in mind, the thesis studies whether larger Danish companies have strong internal control environments. Finally, the thesis looks into the elements of the COSO Framework contributing towards a strong internal control environment, including the advantages of observing a framework. In Denmark, the companies preparing financial statements in accordance with accounting class D are required to disclose their risk management and internal control in the annual report. However, this does not imply that other accounting classes are not to some extent regulated through legislation. The law requires that the board of directors establishes the necessary internal control in a company. On the other hand, the law does not require that Danish companies observe a framework. In spite of this, an increased focus has been on internal control in recent years. 98 state authorised public accountants participated as respondents in the study, which was carried out by using an electronic questionnaire. The respondents have estimated the number of Danish companies complying with the COSO Framework in percentages. Moreover, the respondents have provided empirical data as to the elements included in the COSO Framework in order to create a strong internal control environment. The study shows that the number of larger Danish companies complying with the COSO Framework is increasing in harmony with the size of the company. The bigger the company the more companies comply with the COSO Framework. The study proves that 50-60% on average of the largest Danish companies preparing financial statements in accordance with accounting class D or IFRS comply with the COSO Framework. For larger Danish companies preparing financial statements in accordance with accounting class C, the number of companies complying with the COSO Framework is 30% on average. The respondents evaluate that the companies would benefit greatly from observing a formalised framework such as the COSO Framework to create more transparency. The compliance may contribute towards a better set-up and systematics by which the companies would focus on valueadding processes as well as elimination of counterproductive processes. To bring internal control into focus, generally speaking, will have a positive impact on a company. The respondents particularly also mention the advantages of focusing more on internal risk management which is considered a huge benefit to the companies – the fact that the companies to a much greater extent would become better at forecasting matters that may affect them negatively. The benefits to a company of implementing the COSO Framework vary from company to company. Consequently, it cannot be generalised whether an implementation always would be of great benefit to a company.

EducationsMSc in Auditing, (Graduate Programme) Final Thesis
LanguageDanish
Publication date2015
Number of pages133