Question

Select one of the five COSO internal control components, Develop one control process that could be associated with the COSO control component you selected., Write 2 control activities related to the control process you developed.,  Describe how each of these two control activities could be tested.

Answer 1

Five COSO internal control components

• Control Environment
• Risk Assessment
• Control Activities
• Information and Communication
• Monitoring

Control Environment

Control environment: the right way to put policies and procedures in management that guide the organization? What type of tone to set in the organization. So that everyone knows that they have to make sure that your controls are running effectively and they are getting the results they expect?

• Exercise integrity and ethical values.
• Make a commitment to competence.
• Use the board of directors and audit committee.
• Facilitate management’s philosophy and operating style.
• Create organizational structure.
• Issue assignment of authority and responsibility.
• Utilize human resources policies and procedures.

Two control activities

• The organization selects and develops control activities that contribute to the mitigation of risks to the achievement of objectives to acceptable levels.
• The organization selects and develops general control activities over technology to support the achievement of objectives.