Question

Internal control procedures are important in every business, but at what stage in the development of a business do they become especially critical?

Short answer

Answer

Internal controls become critical at a phase where the management is, at this point, not ready to supervise or control the operations of a given organization.

Step-by-step solution

Step-by-Step SolutionStep 1: Introduction to topic-

Internal control system: An internal controls system involves a set of policies and rules implemented by an organization to increment efficiency, provide guidance and build up and increase the adherence to policies.

Internal control policies become critical-

Internal control procedures become particularly critical when the business manager can never again control the business through personal supervision and direct participation.