The rise of Compliance Systems? The evolution of internal control through the accounting literature

Abstract

Compliance systems aim to prevent the commission of fraud and corruption by promoting internal procedures and ethical behavior among individuals. Therefore, this research analyzes how the existing accounting literature examines the evolution of internal control and how it can reflect the implementation of compliance systems' features. The starting presumption of this research is that compliance systems result from a process of audit implosion in which the characteristics of the audit society influence the organization's internal control. New regulations like Sarbanes-Oxley, the COSO Framework, or the compliance regulation of European countries turned firms out-inside by requiring internal assurance about the effectiveness of their internal control. Compliance can be considered the last step within the evolution of internal control, acquiring a self-oversight and ethical perspective. This paper contributes to the accounting literature by showing that the study of compliance systems can foster the bridge between two trends within the accounting literature: management control and risk management. This research argues that recent regulations supposed the connection of two separated trends in the literature as the interactions and relations are now a risk to be managed.

Es la versión preprint del artículo. Se puede consultar la versión final en https://doi.org/10.1080/02102412.2023.2255416