Checks and balances,
Definition of Checks and balances:
Corporate: Internal control mechanism that guards against fraud and errors due to omission. In a system with checks and balances, the authority to make a decision, and the associated responsibility to verify its proper execution, is distributed among different departments. These department are kept logically and physically apart, and no one department can complete a transaction all on its own. For example, the purchasing department orders goods, the stores-department receives and compares them with the respective purchase orders, the quality assurance department inspects and verifies their quality, the accounts department verifies the invoice amount, and only then the comptroller authorizes the payment for the purchase. This process emphasizes interdependence without interference, and creates a data trail or paper trail for auditing.
Counterbalancing influences by which an organization or system is regulated, typically those ensuring that political power is not concentrated in the hands of individuals or groups.
Governmental: Extension of the separation of powers doctrine, under which each branch of a government can (if necessary) counter the actions or decisions of the other branches. This arrangement ensures transparency, and prevents domination of the government by any branch.
How to use Checks and balances in a sentence?
- Having and independent audit done of a business is a good way to maintain checks and balances , ultimately with the intent of identifying and/or minimizing errors or misrepresentations.
- The system of checks and balances that the company had in place were impenetrable thus reducing their number of corporate thefts and embezzlement issues to zero.
- The three parts of government in Washington DC make up checks and balances , providing a better and stronger structure of government, in which one part is responsible for overlooking on the other parts.
- The current system provides good checks and balances that ensure distribution is transparent and fair.
Meaning of Checks and balances & Checks and balances Definition