Abstract
The importance of optimal allocations of resources to the internal control effort of firms is necessary in a competitive environment following some initiatives mandating such efforts. Viewing the internal control effectiveness as a stock variable affecting the net benefits of the firm, we address the issue of the optimal path internal control outlays in a multiperiod setting. Our analysis highlights some interrelationships among the parameters in the model, in addition to providing a cross-point solution for switching to lower levels of outlays.
Original language | English (US) |
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Pages (from-to) | 1-13 |
Number of pages | 13 |
Journal | Journal of Accounting, Auditing & Finance |
Volume | 3 |
Issue number | 1 |
DOIs | |
State | Published - Jan 1988 |
Funding
The authors express their appreciation for the comments of an anonymous referee and for the financial support provided by the Accounting Research Centers of their respective institutions, Northwestern University and the University of North Carolina.
ASJC Scopus subject areas
- Accounting
- Finance
- Economics, Econometrics and Finance (miscellaneous)