Internal Control for SMEs in Geneva in 2025: Managing Risks and Automating Effectively

Risk management, regulatory compliance, and process optimization are strategic issues for Geneva SMEs. Yet, internal control (ICS) remains a topic rarely invested in outside large corporations or listed groups. How can SMEs meet this challenge, limit risk exposure, and leverage technological innovations to structure, secure, and simplify internal management?

This guide provides a pragmatic vision for implementing and evolving internal control in SMEs, with the contribution of modern tools and constant attention to compliance, team accountability, and efficiency.

1. Why Invest in Internal Control?

Internal control aims to provide reasonable assurance for:

• Achieving operational objectives (information reliability, flow optimization, prevention of errors and fraud),
• Compliance with laws and regulations (tax, social, commercial, data protection),
• Safeguarding assets and business continuity.

Concrete case: A lack of task separation in supplier invoice validation can lead to unauthorized payments or misappropriations, with major financial and reputational impacts for an SME.

2. What Are the Legal Requirements in Switzerland?

Since the reform of corporate law, all Swiss AGs and GmbHs must have an appropriate organization for internal control according to their size and risks (Art. 716a CO, Art. 961 CO). This framework, sometimes viewed as abstract, offers real flexibility to adapt the ICS to SME realities.

Key Regulatory Points:

• Since January 2023, internal control requirements have been strengthened for public interest enterprises (but SMEs are also concerned via arts. 716a and 961 CO).
• Requirement for a brief report on internal organization and major risks at general meetings (Art. 961 CO).

Useful link: Internal Control according to CO, Practical Guide

3. Mapping and Prioritizing Risks in SMEs

Before any approach, identifying main risks (accounting errors, unauthorized payments, tax non-compliance, poor confidentiality management, etc.) is essential.

Concrete steps:

1. List your sensitive processes: invoicing, payments, payroll, inventory, data management, cash management, bank relations, etc.
2. Analyze potential risks for each: who is responsible, what task separations, what controls, what tools exist?
3. Prioritize: focus on key processes where risk is highest.

4. Building a Suitable and Agile Internal Control System

A relevant ICS relies on a few simple principles, adapted to the SME’s size and resources:

• Separation of duties: Avoid having one person perform all operations (e.g. supplier creation, validation, payment)
• Multi-level validation: Introduce verification or authorization steps
• Traceability: Store evidence, log validations, and access to key documents
• Training and awareness: Involve all employees, update procedures after each regulatory or technical change.

Tip: Document essential validation circuits with simple tables or diagrams, accessible to everyone.

5. Automating Controls: Opportunities and Limits

Digital solutions (e.g. Odoo, ERP integration, payroll software like Swissdec) strengthen process consistency, integrate built-in controls, and save precious time on repetitive tasks.

Automation examples:

• Automated invoice validation: Defined thresholds, signature workflow, alerts for overruns
• Automatic reporting: Generation of VAT or compliance indicator reports
• Electronic archiving: Guarantees on document traceability and integrity

However, automation does not eliminate the need for targeted human controls: vigilance remains essential for exceptions, new cyber/system fraud risks, and regulatory changes.

Useful link: Automation and Internal Control, SME Insights

6. Best Practices and Concrete Solutions in Geneva-based SMEs

• Appointing an ICS officer: Even if not full-time, identify a resource person to coordinate and update risk mapping and process documentation.
• Annual internal or external audit: Request regular audits (internal or outsourced) for independent review (strengths and areas for improvement).
• Monitoring dashboards: Set up KPIs (number of anomalies, validation deadline, process compliance) to monitor your system’s effectiveness.
• Support from a fiduciary partner: Support from a specialized fiduciary facilitates implementation, provides resources and external perspective to secure compliance and free up operational time.

7. Cautions and Common Mistakes

• ICS too complex or theoretical: Favor simplicity and operational focus, document what is actually applied, not what “should be.”
• Insufficient update: Process changes or business growth require systematic review.
• Unmonitored automation: Any automation must remain under control and be subject to regular pilot controls.

8. Useful Tools and Specialized Resources

• SME Portal – Internal Control Organization (Confederation)
• Expert Suisse – Automation Tools and ICS in SMEs (Swiss association of accounting experts)

9. Conclusion: Toward Increased Efficiency and Sustainable Security

Internal control concerns all SMEs, regardless of size. It is both a compliance approach and an opportunity to improve reliability of information, strengthen partner confidence, limit losses, and gain peace of mind. With professional experience, suitable digital tools, and a committed fiduciary partner, the approach is enhanced and becomes a source of added value to the company’s management.

Need a personalized diagnosis or tailored implementation? The Ark Fiduciaire team supports Romandie SMEs at each step to combine compliance, efficiency, and security in internal management.