WHAT DOES COSO STAND FOR?
In 1992, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) developed a COSO Framework for evaluating internal controls. This model has been adopted as the generally accepted framework for internal control and is widely recognized as the definitive standard against which organizations measure the effectiveness of their systems of internal control.
Topics: Enterprise Risk Management, Corporate Governance, COSO, Audit Committee & Board
We all know that change is inevitable, but what can an organization do to keep its strategies and risk management capabilities on the same course as the ever-changing business environment?
Topics: Enterprise Risk Management, Corporate Governance, Audit Committee & Board, Strategic Risk
What is the Second Line of Defense?
Essential to effective risk management, the lines-of-defense model is implicit in COSO’s internal control framework through the control environment, control, activities, monitoring and other components of an internal control system. It provides assurance to the board of directors, as the elected representatives of the shareholders to oversee the organization’s operations on their behalf, that risks are reduced to a manageable level as dictated by the organization’s appetite for risk. Much more than “segregating incompatible duties” and “ensuring checks and balances,” the lines-of defense model emphasizes a fundamental concept of risk management: From the boardroom to the customer-facing processes, managing risk is everyone’s responsibility.
Topics: Enterprise Risk Management, Corporate Governance, Internal Audit, COSO, Audit Committee & Board, Strategic Risk
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