Question

In: Accounting

Discuss what how to implement the key elements of COSO internal control mode and provide examples?

Discuss what how to implement the key elements of COSO internal control mode and provide examples?

Solutions

Expert Solution

The COSO model defines internal control as “a process, effected by an entity’s board of directors, management and other personnel, designed to provide reasonable assurance of the achievement of objectives in the following categories:

• Effectiveness and efficiency of operations

• Reliability of financial reporting

• Compliance with applicable laws and regulations”

In an “effective” internal control system, the following five components work to support the achievement of an entity’s mission, strategies and related business objectives.

Control Environment

• Integrity and Ethical Values

• Commitment to Competence

• Board of Directors and Audit Committee

• Management’s Philosophy and Operating Style

• Organizational Structure

• Assignment of Authority and Responsibility

• Human Resource Policies and Procedures

Risk Assessment

• Company-wide Objectives

• Process-level Objectives

• Risk Identification and Analysis

• Managing Change

Control Activities

• Policies and Procedures

• Security (Application and Network)

• Application Change Management

• Business Continuity / Backups

• Outsourcing

Information and Communication

• Quality of Information

• Effectiveness of Communication

Monitoring

• On-going Monitoring

• Separate Evaluations

• Reporting Deficiencies

These components work to establish the foundation for sound internal control within the company through directed leadership, shared values and a culture that emphasizes accountability for control. The various risks facing the company are identified and assessed routinely at all levels and within all functions in the organization. Control activities and other mechanisms are proactively designed to address and mitigate the significant risks. Information critical to identifying risks and meeting business objectives is communicated through established channels up, down and across the company. The entire system of internal control is monitored continuously and problems are addressed timely


Related Solutions

Discuss what how to implement the key elements of COSO internal control mode and provide examples?
Discuss what how to implement the key elements of COSO internal control mode and provide examples?
What is COSO? Describe the five elements of COSO's Internal Control - Integrated framework. Provide an...
What is COSO? Describe the five elements of COSO's Internal Control - Integrated framework. Provide an example of each of those components and explain why they are important in providing "Reliable Financial Reporting" for a company.
What is internal control as defined by COSO? Also, explain the other elements of the definition...
What is internal control as defined by COSO? Also, explain the other elements of the definition that are important to internal control.
List the 5 components of the COSO internal control model. Explain each components and discuss how...
List the 5 components of the COSO internal control model. Explain each components and discuss how it affects the rest of the internal control model.
With examples, discuss the key elements of leadership.
With examples, discuss the key elements of leadership.
discuss on COSO and COBIT frameworks for Internal controls
discuss on COSO and COBIT frameworks for Internal controls
Define and discuss the elements of a creative culture and provide examples of how a leader...
Define and discuss the elements of a creative culture and provide examples of how a leader can foster it in their organizations.
According to COSO, the proper segregation of functions is an effective internal control
According to COSO, the proper segregation of functions is an effective internal control procedure. Comment on the exposure (if any) caused by combining the tasks of paycheck preparation and distribution to employees. 
- Provide at least 2 examples for each of the Internal Control components.
- Provide at least 2 examples for each of the Internal Control components.
Explain COSO internal control-integrated framework? Give example of Saudi organizations that uses COSO framework? (write with...
Explain COSO internal control-integrated framework? Give example of Saudi organizations that uses COSO framework? (write with max 200 words with evidence in your own words) Accounting Information System
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT