Methodology of Designing the System of Internal Bank Control

Abstract

The article deals with a brand new concept of methodology of designing (developing) the system of internal bank control. The authors use the system paradigm as a basic, key principle of methodology of designing and developing the system of internal bank control. The bank is considered as a complicated social and economic system that consists of structural components – functional bank sub-systems, which form in their integrated unity a new quality, i.e. deposit-credit institution. The second key component of this methodology is the principle of system-functioning organization based on the idea that each institutional component of the system (internal structural-functional bank divisions: services, departments, boars) should be provided with necessary and sufficient set of specific functions. The third key component of this methodology is the principle, a special system requirement: the system of internal bank control is supposed to perform a key function, i.e. to ensure feedback in the system. Availability of feedback in any system is a necessary condition of the system functioning. This requirement is especially important for mandeveloped artificial social and economic systems. Adequate performance of this function provides sustainability of the system in time. Optimal performance of the feedback function by the system of internal bank control is dominant, a quality characteristic of the system. Within the frames of the system paradigm key functions of 4 basic types of social and economic systems (4 substances), such as: object, environment, process and project. The authors pay special attention to these key functions. The function of object systems is organization of various elements in an integrated whole. The function of environment systems is communications and coordination, creating conditions for exchange among different system components. The function of process systems is harmonization of work and standing of these and those fixed environment or objects and their groups. The function of event (project) systems is innovative transformation, serious alteration of other types of social and economic systems. The authors think that availability (projection) and system realization of key functions of all 4 types of systems revealed through functional concept of the bank provide the process of sustainable and efficient functioning of the bank as an organizational and economic system.

Keywords

• bank as a system being projected
• system paradigm
• system of internal control
• system and functional analysis
• form transformation
• content transformation
• functional concept