COSO’s 2013 Framework- A New Standard for Internal Control
In the world of regulatory compliance, you need all the help you can get in order to remain aligned with those policies and procedures to which your company is subject. Nowhere is this need for policy compliance greater than with publicly-traded companies. Not only do you have a duty to provide products or services to your clients, but you also owe it to your shareholders to ensure their confidence in the stability of your company’s internal controls is not misplaced.
The good news is that personnel responsible for enterprise risk management are not left to work without a net! Thanks to the Internal Control-Integrated Framework (ICIF) established by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), you and other compliance officers have been given a set of ground rules to help you establish a sound internal framework to ensure that your company remains in line with industry standards. Yet standards, as you are well aware, often have a tendency to change.
New Concepts for 2013
The business world has seen dramatic shifts in practices from when the COSO framework was first established in 1992. Due to the market’s dynamic nature, the COSO board saw the need to revisit many of the standards they set forth, and to update them in accordance with today’s practices. That recognition led to the release of this latest revision of the Internal Control-Integrated Framework (ICIF) in May of 2013. While this new version reaffirms the timelessness of many of the concepts presented in the 1992 framework, it also further defines many of that version’s original principles, among which are:
- Reporting: While the 1992 framework tackled the issue of reporting from an external perspective, the 2013 version now explicitly and more clearly encompasses both internal and external financial and non-financial reporting.
- Internal control principles: The 2013 framework further elaborates upon the 17 codified principles of internal control set forth in the 1992 version. It also calls for documented rationalization for those principles that companies don’t feel are relevant to them.
- Requirements and deficiencies: Standards for principles being “present” and “functioning” are explained and major deficiencies in following the framework’s internal control principles are now well-defined, placing the responsibility on management to use its own good judgement in deciding how those principles are integrated into their company’s operations.
- Points of focus: Advice on how and where management can focus its energies on implementing the framework’s 17 principles is available to help in the transition to this new model.
The Key to a Smooth Transition
If your company adopted the 1992 COSO framework, you have until December 15 of 2014 to transition to the new 2013 version. I.S. Partners, LLC can help you make that transition a smooth one. We don’t just teach you the new principles; we help you understand them, and learn how they can be fully integrated into your company’s operations in order to improve your internal processes and your overall business environment. With our help, remaining compliant no longer becomes a challenge, but rather an opportunity for continuous improvement.
Compliance monitoring is a vital aspect of your company’s operations, yet such tasks need not demand all of your time and attention. By taking advantage of services we offer at I.S. Partners, LLC, you are made aware of any governmental or industry policy changes that could affect your company’s compliance standing. You are also provided with all of the tools and training that you need in order to complete a smooth transition between policy changes. I.S. Partners, LLC guarantees to deliver what we promise to all of our clients: An audit without anxiety!
If you have any questions regarding the transition to the COSO’s 2013 framework or want to learn more about I.S. Partners, LLC, please contact us at 215-675-1400 or email us at [email protected]c.com.