CAQ educational guide describes internal control process

BY KEN TYSIAC

A new guide released Thursday by the Center for Audit Quality (CAQ) is designed to educate investors and the general public on a process that reinforces reliable financial reporting at U.S. public companies.

The CAQ’s Guide to Internal Control Over Financial Reporting describes how companies enhance the reliability of their financial statements by reducing the risk of material errors or misstatements.

“An effective system of internal control over financial reporting is one of the bedrocks of the financial reporting system underpinning U.S. securities markets,” CAQ Executive Director Cindy Fornelli said in a news release.

The CAQ is affiliated with the AICPA.

The guide describes financial reporting controls that companies use to provide reasonable assurance that their financial statements are reliable and prepared in accordance with GAAP. Company management’s role in establishing an effective internal control process and the audit committee’s oversight of internal control also are described in the publication.

Ken Tysiac ( ktysiac@aicpa.org ) is a JofA senior editor.

SPONSORED REPORT

Why cybercriminals are targeting CPAs

This free report expands on the most commonly found scams, why education and specialized IT knowledge help to lessen security vulnerabilities, and why every firm should plan carefully for how it would respond to a breach.

PODCAST

How tax reform — and Excel — are changing the CPA Exam

Mike Decker, the vice president of examinations at the AICPA, discusses changes being made to the exam as a result of tax reform — and about how Excel will now be available for use on the test.