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Control Environment, Risk Assessment and Monitoring in United Arab Emirates Businesses

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Creative Business and Social Innovations for a Sustainable Future

Part of the book series: Advances in Science, Technology & Innovation ((ASTI))

Abstract

The objective of this study reflects an atmosphere conducive to the effective operation of the accounting information system and control activities in UAE business. An empirical survey using a questionnaire was carried out to achieve this objective. The case study taken into analyses is based on one hundred valid questionnaires were randomly distributed to different types of UAE businesses and subsequently collected. The collected data were analyzed using the statistical package for social sciences (SPSS) version 12 the survey results revealed a significant positive relationship within the variables: 1. Management Philosophy and Operating Style, 2. Organization Structure, 3. Methods of assigning authority and responsibility, 4. Board of Directors integrity and Ethical Values, Commitment to Competence, 5. Human Resource Policies and procedures, 6. Risk Assessment, and 7. Monitoring. The results also revealed that the applicable Control Environment, Risk Assessment and Monitoring Auditing of this paper. The results of the study will enable accountants and others in the profession to foresee risk assessments and monitoring internal audit for the success of businesses.

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Author information

Authors and Affiliations

  1. College of Business Administration, American University in the Emirates, Dubai, UAE

    Hikmat AlRawi & Narcisa Roxana Mosteanu

  2. Morocco University, Rabat, Morocco

    Ibaa H. Alrawi

Authors
  1. Hikmat AlRawi
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  2. Narcisa Roxana Mosteanu
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  3. Ibaa H. Alrawi
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Corresponding author

Correspondence to Hikmat AlRawi .

Editor information

Editors and Affiliations

  1. American University in the Emirates, Dubai, United Arab Emirates

    Miroslav Mateev

  2. UCLan Cyprus, Larnaka, Cyprus

    Panikkos Poutziouris

Appendix: Questionnaire

Appendix: Questionnaire

Control environment, risk assessment and monitoring

Position:

Low Mgt.

Middle Mgt.

Top Mgt.

Years in service:

5–10

11–15

16–20

21–25

26–30

Qualification (degree):

High School

Bachelor

Master

CPA

Ph.D.

1. Management Philosophyand Operating Style

Low 20%

40%

60%

80%

High 100%

1. Does Management adequately consider the potential effect of taking large or unusual business risks prior to doing so?

     

2. Are business risks adequately monitored?

     

3. Is management not overly aggressive with respect to financial reporting?

     

4. Are Financial statement estimates developed in a conscientious manner?

     

2. Organization Structure

Low 20%

40%

60%

80%

High 100%

5. Is the organization of the entity clearly defined in terms of lines of authority and responsibility?

     

6. Does the entity have a current organizational chart and related material such as job descriptions?

     

7. Are policies and procedures for authorization of transaction established at an adequately high level?

     

8. Are such Policies and procedures adequately adhered to?

     

3. Methods of assigning authority and responsibility

Low 20%

40%

60%

80%

High 100%

9. Are authority and responsibility to deal with organizational goals and objectives, operating functions and regulatory requirement adequately delegated?

     

10. Has Management established communicated policies about appropriate business practices and conduct and conflicts of interest?

     

11. Has the entity developed an It system documentation that indicates the procedures for authorizing transactions and approving systems changes

     

4. Board of Directors integrity and ethical Values, Commitment to Competence

20%

40%

60%

80%

100%

12. is the level of experience, status and independence of the members of the board of directors appropriate for the organization

     

13. Are there regular meetings of the board of directors to set policies and objectives, review the entity’s performance and take appropriate action and are minutes of such meetings prepared and signed on a timely basis?

     

14. Has Management taken adequate action to reduce incentives and temptations that might prompt employees to engage in dishonest, illegal and unethical Acts?

     

15. Does Management exhibit an adequate commitment to competence in the performance of essential jobs within the organization?

     

5. Human Resource Policies And procedures

20%

40%

60%

80%

100%

16. Does the entity employ sound practices, including background investigations, where appropriate?

     

17. Are employees adequately trained to meet their Job responsibilities?

     

18. Is employee performance evaluated at regular intervals?

     

19. Are employee in positions of trust bonded?

     

20. Are employee in positions of trust required to take vacations and their duties rotated while they are on vacation?

     

6. Risk Assessment

20%

40%

60%

80%

100%

21. Is the chief executive officer attuned to external factor that affect the risk of achieving the entity’s objectives?

     

22. Is the chief executive officer attuned to internal factor that affect the risk of achieving the entity’s objectives?

     

7. Monitoring

20%

40%

60%

80%

100%

23. Are key Management personnel sufficiently involved with operations to monitor the effectiveness of internal controls?

     

24. Does management have a formal process for considering reportable conditions from external auditors?

     

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AlRawi, H., Mosteanu, N.R., Alrawi, I.H. (2019). Control Environment, Risk Assessment and Monitoring in United Arab Emirates Businesses. In: Mateev, M., Poutziouris, P. (eds) Creative Business and Social Innovations for a Sustainable Future. Advances in Science, Technology & Innovation. Springer, Cham. https://doi.org/10.1007/978-3-030-01662-3_8

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