Strengthening your foundations: Internal controls for public companies

Accounting for the Future

Having robust internal controls is necessary for accurate financial reporting. In this episode, host Anne-Marie Henson is joined by Michael Crolla, Partner and National Capital Markets & Public Company Services Leader, and John Asher, Partner and Risk Advisory Services Leader in Western Canada. Drawing from their experience, they discuss the current Canadian regulatory landscape for public companies, how strong governance affects audits, and the role that strong internal control environments play in financial reporting. Explore the challenges companies face when establishing internal controls, best practices for building an audit committee, and special governance considerations for companies planning to list. Plus, discover key insights for optimizing internal controls in an evolving business landscape.

What you’ll hear in this episode:

[01:30] An overview of the Canadian regulatory landscape for public companies.

[03:56] The importance of establishing and maintaining strong internal control environments.

[06:11] How a strong control environment affects the audit process.

[10:11] Challenges companies face when trying to develop internal controls.

[15:06] Top qualities an audit committee should have to maintain strong governance.

[22:47] Advice for companies that want to improve their control environment as they prepare to list.

[23:34] Strategies for optimizing internal controls.

Mentioned:

Anne-Marie Henson

Michael Crolla

John Asher

Quotes:

“The regulatory landscape for public companies is really multifaceted and involves several levels of oversight to really ensure the integrity of financial reporting and the internal controls that feed into financial reporting.”

“Having robust internal controls ensures accuracy and reliability of financial reporting.”

“Some of our clients are very busy with acquisitions, and so anytime you have an acquisition, you're bolting on another set of controls, you're bolting on another set of information systems.”

“If you do have that tone at the top, that leadership buy-in, it can really result in a very strong internal control program that really will help mitigate any risks and there's actually more benefits than pain points.”

“The world continues to evolve and change, and there's different risks that we're talking about on this right now that could affect the business as you look into the future.”

“Focus on some of those key issues or key areas that may have a little bit more risk. Try to mitigate that first, see how it's working, and then obviously keep implementing as you go along and adjusting as you go along.”

“Avoid control creep…meaning avoiding adding more controls for the sake of having controls.”

“We talked about tone at the top, but it's really important that there's strong commitment from leadership to ensure that staff are knowledgeable and that they're aware of regulations.”