POLICY STATEMENT on INTERNAL control

The Board of Visitors of Radford University recognizes the need for, and the value of, a strong system of internal control.  Internal control is a process designed to provide reasonable assurance regarding the achievement of university objectives in the following categories: 

1.        Effectiveness and efficiency of operations

2.        Reliability of financial reporting

3.        Compliance with applicable laws and regulations. 

As a process, internal control is a series of actions that permeate the university’s activities and culture.  It has five major components:  control environment, risk assessment, control activities, information and communication, and monitoring.  

Senior management defines and communicates the internal control environment, i.e., the “tone-at-the-top,” by their commitment to competence, integrity, and ethical values.  These choices pervade the structure of all university activities, including day-to-day policies and the attitude of employees.  

Management identifies and analyzes risk in association with their operational, financial reporting and compliance objectives.  They develop control activities, i.e., policies and procedures, to identify risk and to ensure that their reporting and compliance objectives are met.  They arrange information and communications systems so that all personnel receive a clear message regarding their role in the internal control system.   

The Office of Audit and Advisory Services is charged with the responsibility for ascertaining that the ongoing processes for controlling operations throughout the university are adequately designed and are functioning in an effective manner.  Audit and Advisory Services is also responsible for reporting to management and the Business Affairs Committee of the Board of Visitors on the adequacy and effectiveness of the university’s systems of internal control, together with ideas, counsel, and recommendations to improve the systems. 

The Business Affairs Committee of the Board of Visitors is responsible for monitoring, overseeing, and evaluating the duties and responsibilities of management, the Office of Audit and Advisory Services, and the external auditors as those duties and responsibilities relate to the university’s processes for controlling its operations. The committee is also responsible for determining that all major issues reported by Audit and Advisory Services, the external auditor, and other outside advisors have been satisfactorily resolved.  Finally, the committee is responsible for reporting to the full board all important matters pertaining to the university’s controlling processes. 

Adopted by the Business Affairs Committee of the Board of Visitors on February 17, 1999.