Committee of Sponsoring Organizations of the Treadway Commission - - PDF document

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Committee of Sponsoring Organizations

• f the Treadway Commission

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COSO was organized in 1985 to sponsor the National Commission on Fraudulent Financial Reporting, an independent private-sector initiative that studied the causal factors that can lead to fraudulent financial reporting. It also developed recommendations for public companies and their independent auditors, for the Securities and Exchange Commission (SEC) and other regulators, and for educational institutions.

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11/9/2017 2 The National Commission was sponsored jointly by five major professional associations headquartered in the United States:

• The American Accounting Association (AAA),
• The American Institute of Certified Public

Accountants (AICPA),

• Financial Executives International (FEI),
• The Institute of Internal Auditors (IIA),
• The National Association of Accountants (now the

Institute of Management Accountants [IMA]).

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The first chairman of the National Commission was James C. Treadway, Jr., Executive Vice President and General Counsel, Paine Webber Incorporated and a former Commissioner of the U.S. Securities and Exchange Commission. Hence, the popular name “Treadway Commission”.

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11/9/2017 3 The committee is dedicated to providing:

• Leadership through the development of

frameworks,

• Guidance on enterprise risk management,
• Internal control,
• Fraud deterrence.

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The Green Book

Standards for Internal Control in the Federal Government

Published by the Government Accountability Office (GAO) on September 10, 2014

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INTERNAL CONTROLS PROGRAM

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Internal Control Program

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• Documentation of policies
• Documentation of processes
• Improve internal control processes
• Monitor internal controls

Internal Control Consultant

• Engaged to review at least one major component within the

Town on a regular basis

• Reports Findings and Recommendations to City Management

Town’s External Auditors

• Test strength of internal control processes
• Recommends improvements to staff

Internal Control Program

• Airport
• Conference Centre
• Addison Athletic Club
• Treehouse

Review of Major Component Unit

• Police
• Fire
• Municipal Courts

Bi-annual Review of Departments

• Building Inspections and Permitting
• Utility Billing

Systematic Review of Selected Processes

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EXAMPLE EXAMPLE

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Internal Control Program

Development

• f Plan

Creation of Schedule

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Internal Control Program

January – March 2018 Staff develops internal control schedule April – September 2018 Staff engages consultant to review controls October – December 2018 Town auditors test and review controls

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Internal Control Program

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