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In today's complex regulatory environment, Internal Financial Controls (IFC) play a critical role in ensuring that companies maintain transparency, accuracy, and reliability in their financial reporting. For businesses in India, IFC compliance has become a cornerstone of good corporate governance, especially after the Companies Act, 2013 made it mandatory for certain classes of companies.
At the heart of IFC compliance lies controls documentation - the structured process of recording, testing, and maintaining all internal control activities. Without proper documentation, even the best control framework loses its effectiveness during audits, leading to compliance risks and potential penalties.
This blog explores the importance of robust controls documentation, practical steps to build it, and best practices to ensure smooth IFC compliance in 2025 and beyond.