When managing risk,

do you need more or

better controls?
Find out how you can build
confidence in your internal
controls.
 Globally, investors, management and other stakeholders are seeking higher
standards around internal controls, risk management programs and communication.
Internal controls are a fundamental element of managing risks effectively. In today’s
business climate, companies need a strong internal control environment providing:
• A solid foundation to facilitate growth
• Improvement in the efficiency and effectiveness of operations and reporting
• Security for company assets
• Protection from fraud
• Compliance with laws and regulations

Businesses with strong internal controls tend to be far more adept at identifying and
mitigating risks that can undermine achieving their business goals.

To help build confidence in your internal controls, EY teams offer an internal controls
effectiveness review, specifically focused on private businesses.

The EY Internal Controls Effectiveness (ICE) service is designed to assess financial

statement controls and certain operational controls in five key processes (i.e., order-to-
cash, purchase-to-pay, payroll, inventory and property, and plant and equipment). The
ICE service provides an overview of the effectiveness of these controls that includes:

• Identifying controls that are not designed effectively

• Gaps in the existing control framework

• Recommendations to improve existing controls

With this understanding, your business gets in-depth insights that can help
enhance the efficiency and effectiveness of your internal controls, and meet the
growing needs of your stakeholders. With the help of the ICE assessment, you can
build the confidence you need in your internal controls.

Are your internal controls designed effectively?

Having a proper internal controls • Ineffective controls are being identified

environment in place can be an
• Key risk areas not specifically covered by appropriate controls
important element of your risk
management strategy. But, how do you • Identification of important or monetarily significant adjustments, at the last minute
know that your controls are effectively • Management information inconsistent with data from the accounting records
designed? Are they fit for purpose for
your business today and in the future? • Time-constrained finance department (because of the amount of focus on inefficient
Are you confident that your internal controls)
controls environment can both prevent • Too many manual workarounds
and detect a financial statement
• Internal control not fit for purpose as the company grows
error and fraud? And, crucially, is this
environment ready for your growth? • Increasing finance administration costs

You can consider the EY ICE service if • Inconsistent data from business units or subsidiaries
you are observing one or more of the • Account reconciliations performed offline, with Excel
following challenges:

2 | When managing risk, do you need more or better controls?

How the EY ICE service can support you

EY teams use a combination of techniques to help you evaluate your internal controls environment. They conduct a
four-step assessment and report back their findings and recommendations to you.

Step 1: Step 3:

Help determine maturity of existing controls framework Comparison of existing controls to leading practice

The EY teams use a proprietary tool to assess the current In the next step, your existing controls for each process
maturity of your overall controls framework and help will be mapped to a library of leading practice controls
determine a desired future state. The tool aligns with the that has been built upon years of experience working with
17 principles of the Committee of Sponsoring Organizations similar organizations. This comparison aims to detect the
of the Treadway Commission (COSO) model (2013 strengths and weaknesses of your existing controls and can
Framework). It also provides you with the latest progressive lead to potential improvement recommendations.
thinking on the overall controls environment a business
should have. For example, the tool can help you determine This step provides you with a better understanding of the
the maturity of your: effectiveness of your controls. It also gives insights into
the potential differences and business consequences of
• Controls environment • Information and your existing controls when matched against your peers.
communication Also, it can help uncover duplications, missing controls and
• Risk assessment
• Monitoring activities other anomalies.
• Controls activities
For example, one outcome of the comparison could look like
A potential result of step one could look as follows:
the following:

Control environment
Current situation Leading practice
4.0
Prevent
3.0
manual
2.0
Monitoring Risk Prevent
activities 1.0 assessment automated
0.0 Detect
manual
Detect
automated

Information and Control Most leading companies

communication activities have approximately
75% of their controls as
preventative controls
Future state Current state

Step 2: Step 4:

Walkthrough and documentation of current-state Findings and recommendations report

process, and existing controls and risks
As a last step, all the results of the assessment are
The EY teams then work with you to map your current- compiled and reported back to you. The report includes
state processes, and existing controls and risks. findings and a list of recommendations that you can use
to build a more effective and stronger internal controls
During that walkthrough, they aim to:
environment.
• Understand your transaction flows and key points of
risk — both financial and operational

• Identify existing controls, considering your financial

statement controls and certain operational ones

The result is a more detailed picture of your existing

controls that helps uncover potential weaknesses, which
may impact your business’s ability to operate efficiently
and effectively.

Find out how a faster process to close your books can help your business grow | 3
The value of an integrated team
As an EY audit client, the EY ICE service can be EY | Building a better working world
conducted by the EY audit teams you are already familiar
with. This is advantegous for you, as the EY teams: EY exists to build a better working world, helping to
create long-term value for clients, people and society
• Understand your business processes and the internal
and build trust in the capital markets.
controls environment that surrounds them

• Know your teams, constraints, operating structure Enabled by data and technology, diverse EY teams in
and the key risks identified through the annual audit over 150 countries provide trust through assurance
and help clients grow, transform and operate.
• Provide insights and effectiveness through leveraging
relationships, knowledge of your IT and accounting Working across assurance, consulting, law, strategy,
system, and financial and operational reporting
tax and transactions, EY teams ask better questions
and tools
to find new answers for the complex issues facing our
• Know your industry, key stakeholders, processes and world today.
practices learned during the external audit
EY refers to the global organization, and may refer to one or more, of
While performing the internal controls effectiveness the member firms of Ernst & Young Global Limited, each of which is a
review, your EY audit teams can work with other EY separate legal entity. Ernst & Young Global Limited, a UK company
limited by guarantee, does not provide services to clients.
professionals, when needed, reducing the time impact
Information about how EY collects and uses personal data and a
on you and your staff. These EY professionals bring a description of the rights individuals have under data protection
breadth of knowledge and practical experience with legislation are available via ey.com/privacy. EY member firms do not
complex processes. They are multidisciplinary and work practice law where prohibited by local laws. For more information
across geographies, combining experiences in assurance, about our organization, please visit ey.com.
tax, strategy, transaction and consulting services.
© 2023 EYGM Limited.
All Rights Reserved.

EYG no. 007130-20Gbl

About EY Private
As advisors to the Ambitious™, EY Private BMC Agency
professionals possess the experience and GA 1016900

passion to support private businesses and ED None

their owners in unlocking the full potential This material has been prepared for general informational purposes only and is
of their ambitions. EY Private teams offer not intended to be relied upon as accounting, tax, legal or other professional
advice. Please refer to your advisors for specific advice
distinct insights born from the long EY his-
tory of working with business owners and ey.com/private
entrepreneurs. These teams support the
full spectrum of private enterprises includ-
ing private capital managers and investors
and the portfolio businesses they fund,
business owners, family businesses, family
offices and entrepreneurs.
Visit ey.com/ICE
#ambitionunlocked #privatebusinesses

EY contact

Sylvain Friedman
+1 312 879 5151
[email protected]