As a business grows, day-to-day operations usually move faster than internal controls. Yet good internal controls for business do not have to be complicated. A few simple habits, applied consistently, can reduce errors, limit fraud risk and give owners better information for decisions.
Below are three practical internal controls any company can introduce without major systems changes.
1. Separate duties in payments
Wherever possible, one person in the company should not control an entire payment from start to finish. Basic separation of duties could include:
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One person entering supplier invoices and another approving them
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Dual approval on online banking payments over a set amount
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Only senior staff allowed to change supplier bank details
This simple step makes it much harder for a single individual in the business to make unauthorised payments and also helps catch mistakes early.
2. Reconcile business bank and control accounts every month
Regular reconciliations are one of the most effective internal controls for business finance:
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Match bank statements to the accounting system
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Reconcile card accounts, debtor and creditor control accounts
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Investigate any unexplained balances in suspense or “clearing” accounts
Ideally, one person prepares the reconciliations and someone else reviews them. This routine helps ensure the business records all cash movements correctly and highlights unusual transactions that may need further review.
3. Standardise business processes with simple templates
High-risk processes in a company benefit from clear, repeatable steps. Useful examples include:
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Standard forms for new customer and supplier onboarding
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Simple checklists for contract approval
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Clear expense claim and reimbursement forms
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A short log for recording incidents or complaints
When information is captured the same way every time, the business can train new staff more quickly and spot gaps or inconsistencies.
These three ideas will not remove every risk, but they give a growing business a stronger foundation for accurate reporting and better decisions. For a more detailed overview of internal controls, the UK government’s Business Finance and Support pages provide useful independent guidance.
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