COSO Internal Control Framework

Lesson

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The Committee of Sponsoring Organizations of the Treadway Commission created a framework to evaluate internal controls.

This framework, often referred to as COSO, lists five components of any internal control system:

Control Environment - The ethical values, integrity, and tone at the top of the organization.
Risk Assessment - The process of identifying and analyzing risks that could prevent the organization from achieving its objectives.
Control Activities - The actions, policies, and procedures that help ensure management directives are carried out.
Information and Communications - The process of identifying, capturing, and communicating relevant information to the right people, at the right time, to support the functioning of internal control.
Monitoring - The process of evaluating the effectiveness of internal control performance over time.

Question

You're an auditor explaining the tasks you completed on a recent audit of Tango ltd..

The only relevant information you've discovered is as follows:

An auditor noticed that the accounting system includes relevant data in its records.

Which component of the COSO framework applies?

Answer

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👉 Answer:

This activity contains both, the data being reported and the movement of that information throughout communication channels.