The Committee of Sponsoring Organizations of the Treadway Commission (COSO) is seeking public comment on a proposed document that explains how to apply its guidance to internal control over external financial reporting.
COSO on Tuesday released an exposure draft of its Internal Control Over External Financial Reporting (ICEFR): Compendium of Approaches and Examples document.
The proposed Compendium describes how the principles set forth in COSO’s proposed Internal Control—Integrated Framework can be used to design, implement, and conduct internal control over external financial reporting.
A revised version of COSO’s updated Internal Control—Integrated Framework also was released along with an invitation for further comments. The version released Tuesday incorporates input received earlier this year during a comment period that saw more than 200 organizations and professionals write to COSO.
The update of the framework sets out 17 principles across the five components that were described in COSO’s original framework, which was released in 1992. The goal for updating the framework was to ease use and application while reflecting the increased complexity in the business, operating, and regulatory environments.
In addition, COSO released a proposed Illustrative Tools document designed to help users assess the effectiveness of their internal control systems based on the framework’s requirements.
Interested parties can read the proposed documents, answer COSO’s survey questions, and submit comment letters at COSO’s website. The public comment period ends Nov. 20, and release of the final documents is expected during the first quarter of 2013.
“The addition of the Compendium and Illustrative Tools enhances the value of the framework by providing additional context to how it is applied in various settings,” COSO Chairman Dave Landsittel said in a statement. “Because COSO publications carry weight with a wide range of stakeholders, public input is critical in assuring their relevance and usefulness.”
COSO is a joint initiative of five private-sector organizations, including the AICPA, dedicated to providing thought leadership on enterprise risk management, internal control, and fraud prevention.
—Ken Tysiac (email@example.com) is a JofA senior editor.