COSO Seeks Input in Updating Internal Control Framework

The Committee of Sponsoring Organizations of the Treadway Commission (COSO) recently announced the launch of an online survey to help gather input from stakeholders on updating the COSO Internal Control - Integrated Framework. The current framework was originally published in 1992, and it has been determined that an update is needed to address challenges that organizations face in an increasingly complex business environment.

The goal of the survey is to develop the most effective framework for designing, evaluating and managing internal control and provide more comprehensive conceptual guidance and practical examples. The target date for publication of an update to the framework is 2012.

The survey is intended to receive input from a wide range of organizations on internal control and determining which areas of the existing framework are still relevant, what may require updating and what may be missing. In addition to the survey, COSO will also utilize other methods of data gathering and analysis, including meetings with the project advisory council comprised of representatives from industry, academia, government agencies and not-for-profit organizations. The updated framework will also be made available for public comment in order to solicit any additional input.

The framework seeks to accomplish three main objectives through five components. Reliability of financial reporting, effectiveness and efficiency of operations, and compliance with applicable laws and regulation are sought through the following elements:

• Control environment
• Risk assessment
• Control activities
• Information and communication
• Monitoring

The online survey can be found at the COSO website. The survey will remain open until Jan. 31, 2011.