You will recall that internal controls are actions taken to make sure the right things happen and the wrong things don’t.
There are two types of internal controls
Preventative controls: Designed to keep errors or irregularities from occurring in the first place. They are built into internal control systems and require a major effort in the initial design and implementation stages. However, preventative controls do not require significant ongoing investments.
Detective Controls: Designed to detect errors and irregularities that have already occurred and to assure their prompt correction. These controls represent a continuous operating expense and are often costly but necessary. Detective controls supply the means with which to correct data errors, modify controls or recover missing assets.