|
|
  COSO (Committee of
Sponsoring Organizations) was originally formed in 1985 to sponsor the
National Commission on Fraudulent Financial Reporting, an independent
private sector initiative which studied the causal factors that can lead
to fraudulent financial reporting and developed recommendations for
public companies and their independent auditors, for the SEC and other
regulators, and for educational institutions.
The National
Commission was jointly sponsored by the five major financial
professional associations in the United States, the American Accounting
Association, and the American Institute of Certified Public Accountants,
the Financial Executives Institute, the Institute of Internal Auditors,
and the National Association of Accountants (now the Institute of
Management Accountants). The Commission was wholly independent of each
of the sponsoring organizations and contained representatives from
industry, public accounting, investment firms, and the New York Stock
Exchange.
The 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").
The benefit of COSO was that it formalized an approach to evaluating an internal control environment relating to financial controls. COSO defines internal control as the process designed to provide a reasonable assurance that the Society meets it goals and the goals common to every legitimate organization. Those being:
At Pivot Point, we fully endorse the COSO framework and have blended this framework with COBIT to better address the broader requirements of Information Systems Auditing. Our blended approach fully addresses the integrated framework for Internal Controls as defined by COSO which include five interrelated components:
| ||||||
|