Internal Control Scheme Research Articles

Internal control technologies within industrial organizations

AbstractPrevious studies of industrial organizations have examined the effects of formal monitoring controls on employee‐performance. The present study extends existing research by analyzing the firm's ability to rely upon alternative internal control strategies and by including opportunities for employee‐collusion. In particular, we model formal and informal monitoring activities and investigate their combined effect upon employees' incentives to collude. Additionally, a sensitivity analysis is performed to determine the relative efficiencies of various types of internal controls.