Annual Update for Accountants and Auditors: 2020

Chapter 11Other Recently Issued Guidance

Learning objectives

• Identify the key objectives and scope of the Committee of Sponsoring Organizations of the Treadway Commission’s (COSO) recently issued framework on enterprise risk management, Enterprise Risk Management—Integrating with Strategy and Performance and four related thought papers issued by COSO.
• Determine the objectives of the AICPA Enhanced Audit Quality Initiative and describe the scope of the Center for Audit Quality’s Audit Quality Disclosure Framework issued in January 2019.

COSO’s mission is to provide thought leadership related to enterprise risk management (ERM), internal control, and fraud deterrence. COSO has recently issued four different thought papers that are summarized in this chapter.

This chapter also discusses efforts by the AICPA and the Center for Audit Quality (CAQ) to improve audit quality.

Overview of COSO

COSO was formed in 1985 to sponsor the National Commission on Fraudulent Financial Reporting, an independent private-sector initiative that studied the factors believed to contribute to fraudulent financial reporting. Their original framework, titled Internal Control Over Financial Reporting, was issued in 1992. Given the visibility of internal controls over financial reporting that resulted from the passage of the Sarbanes-Oxley Act of 2002, that framework is widely known and used around the world. In 2013, COSO issued a revision of that framework which retained the same title. Over the years, ...