HELP US IMPROVE INTERNAL CONTROL SYSTEMS WORLDWIDE
PARTNERS WANTED:
The Internal Control Institute™ (ICI) improves organizational Internal Control worldwide by providing training, products and services and individual Professional Certifications recognized internationally. The Institute's Board of Advisors has determined it would like to further expand into areas where it is not directly represented. ICI provides world-class programs and its intellectual property to affiliates free of charge and shares all program revenue with them. If your organization is interested in partnering with ICI to earn revenue while you contribute to the development of the internal control profession worldwide please contact Dr. Michael Pregmon, Jr., Chief Operations Officer, by email at: [email protected] or by phone at 727-538-4113in the USA.
The Internal Control Institute has developed a CICS Common Body of Knowledge Mini-Assessment that helps an individual determine their knowledge as it relates to governance and control practices. Results point out areas of knowledge that may require additional training and experience. The assessment also provides a measurement to the individual's readiness for CICS certification. The assessment measures core knowledge in eight critical areas including: Internal Control - Principles, Terms and Concepts, Internal Control Environment, Risk Management, Assessing Application Controls, Business System Control Assessment, Risk Assessment, Internal Control Measurement and Reporting, and Governance Practices
Start becoming an Internal Control professional today!
The ICI "Certification Series" has been completely updated and is available online to everyone around the world! Course content prepares individuals to design and/or assess internal control and to assist management in installing internal control processes. In addition, the series prepares candidates for the Certified Internal Control Specialist (CICS) Examination.
Online course pricing has been reduced by over 70%
Business Planning - Where Are We?
By Michael Pregmon, Jr., Ph.D., CICP
Dr. Michael Pregmon, Jr. COO and Managing Director
In a previous article on this subject, we introduced the Business Planning process. We stated that a plan requires a detailed consideration of seven sections, which when completed, will provide the necessary "roadmap" for successful activity implementation. The component questions are:
Where are we?
Where do we want to go?
How are we going to get there?
Who is responsible?
How much will it cost?
When will it be done?
Completing the feedback loop
Where Are We?
In this article we will briefly cover the first question of a planning cycle, which is effectively designed for the planner to identify the organization's or activity's current status. On the surface, this may seem to be a simple task, but it may be more difficult than originally envisioned.
One of the major challenges the planner has in this phase is to maintain objectivity. There often is a tendency to take an overly optimistic or overly pessimistic viewpoint of the current status. One of the methods to avoid a bias viewpoint is to get input from several sources in critically assessing your current "state of affairs." But recognize, it is not difficult to conclude that you are doing a "bang-up" job or conversely your performance has been an overall "downer" when completing this phase of the cycle.
The next part of this initial phase of the plan is to assess theinternal and external operations of your department/activity, or of the total enterprise if it is a plan for the whole company. Nevertheless, the same analysis must be undertaken if the plan involves a total company operation or simply one department or function within a company.
Internal Environment
Here we must assess the activities that affect internal performance. Such things as personnel manning, morale, personnel turnover, process adequacy, policies, procedures, organization integrity, operations control, supervision adequacy, operating cost, etc. must be individually reviewed. These important ingredients then become key points for improvement in latter parts of the plan.
External Environment
This section of the plan pertains to activities that affect business outside the company or department / function. If this is a plan for the company, this is the section where a detailed analysis of marketplace competition is assessed. Each major competitor is considered and how our performance compares to expectations. If this is a plan for our department/function such as internal control, we should include an analysis of such things as IC training and activities effectiveness throughout the company, relationships with other departments, IC policies and practices properly executed, etc.
Recognize that the effectiveness of internal control throughout the company reflects directly on the internal control activity/department or function.
ICI ANNOUNCEMENTS
ICI Affiliate News:
The Internal Control Institute is conducting certification training in a classroom format for the internationally recognized CICS (Certified Internal Control Specialist) certification in internal control. Information on these programs regarding dates and schedules can be found on the Events tab on our Website or directed to the affiliate named below:
Botswana:
ICI has entered into an agreement with Internal Control Institute of Botswana (ICI Botswana":) as its representative for Products, Services and Internal Control Certifications (CICS/CICP) in this territory. ICI Botswana will be responsible for all development activities in this area, including professional training and Certification. Individuals or companies interested in internal control training or Certification should contact:
CICS Training in Dutch in Brussels with 13 participants will take place in seven sessions over the period 4 October 2019 to 10 January 2020. ICIB has
already received 9 registrations for the session in French starting mid January.
For more information on scheduled training and exams please contact Mr.Yves Dupont of ICI Belgium at:
Better Business Governance - APAC PTE LTD (BBG) has become a representative for Products, Services and Internal Control Certifications (CICS/CICP) in Myanmar and Cambodia.
Better Business Governance will be responsible for all development activities, including professional training and Certification. For more information on upcoming activities in this area please contact:
The CICS exam is now being provided in Arabic. Osool Training and Consulting has courses and testing available in Jordan, Libya, Muscat, Sudan, Qatar, the United Arab Emirates, Kuwait and Palestine.
Training Plan 2019
Certified Internal Control Specialist (CICS) Certification Preparation Programs are scheduled as follows:
Doha, Qatar - November 17 to 21, 2019
Dubai, UAE - December 15 to 19, 2019
Interested applicants in the region should contact Osool for scheduling for future programs. For additional information on scheduled ICI Certification and program sessions, please contact:
ICI has entered into an agreement with GRC Consultancy Pte Ltd. (ICI Singapore, Malaysia, Indonesia and Taiwan) as its representative for Products, Services and Internal Control Certifications (CICS/CICP) in those territories.
Individuals or companies interested in internal control training or Certification should contact:
ICI has entered into an agreement with Business and Financial Consulting company in the Republic of Tunisia (hereinafter referred to as "ICI BFC" as its representative for Products, Services and Internal Control Certifications (CICS/CICP) in the Republic of Tunisia
. ICI BFC will be responsible for all development activities in this area, including professional training and Certification. Individuals or companies interested in internal control training or Certification should contact:
CICS traiing course to be held on 4, 11 & 18 March 2020
For more information on upcoming activities in Vietnam please contact: NGUYEN THANH TUNG (MBA. M.Eng, PhD.) Director, FMIT Institute of Financial Management & Information Technology, Level 5, 126 Nguyen Thi Minh Khai Street, Ward 6, District 3, HCMC, Viet Nam
Each month the staff of The Internal Control Institute reviews hundreds of articles related to Internal Control and Corporate Governance. Here are brief summaries of some of the top articles (along with links to the original article) that may be of interest to you.
How to optimize fraud risk management to reduce chargebacks
By Vishal Sagar
digitalcommerce360.com
In 2017, worldwide fraud linked to payment cards triggered an estimated
$24.26 billion in losses, according to the Nilson Report. And Nilson projects that number will rise to $34.66 billion by the year 2022.
Add to that a study released in 2018 by Javelin Strategy & Research showing that card-not-present fraud is 81% more likely to occur than in-store or card-present fraud, as well as the 3,813 U.S. publicly disclosed breaches that occurred in the first six months of 2019. These numbers are far from small, and seem to be continuously growing. Crimes of this type that happen behind closed doors are killing businesses, as well as the customer shopping experience. Online fraud is a major issue for all types of businesses, as it has the potential to wipe out an entire company. However, there are ways to avoid learning things the hard way and instead get tips ahead of time on how to protect your business from online fraud before it happens.
CEOs, accountability, and a new standard of corporate governance
By Stephen Hahn-Griffiths
bizjournals.com
Nov 14, 2019
A recent
mass exodus of CEOs proved that the sorrow associated with parting is often far from sweet. In fact, sometimes it leaves a sour taste with staying power. Under fire for shady dealings ranging from sinking finances and sexual indiscretions to illegal activities and downright ethical impotency, a large number of high-profile CEOs became a part of a disappearing act so impressive that it felt Copperfieldian. Make no mistake, however, this is no illusion. New governance and societal trends are transforming the corporate landscape.
By Coates Lear, Kevin McCart, Clay Porter, Ben Wood and Trevor Garmey
The Securities and Exchange Commission ("SEC") recently penalized a public company for violating U.S. economic sanctions. The violation cited the "books and records" and "internal controls" provisions of Securities Exchange Act of 1934 (the "Exchange Act"). With this unprecedented action, the SEC has put companies on notice that the Department of Justice (the "DOJ") and the Office of Foreign Assets Control ("OFAC") are not the only sanctions enforcers in Washington. It is well known that under Sections 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act - enacted as part of the Foreign Corrupt Practices Act ("FCPA") - public companies must keep accurate books and records and maintain internal controls sufficient to ensure that transactions are executed in accordance with management directives and accurately recorded for reporting in the company's financial statements. The SEC often cites public companies for violations of these provisions in cases involving allegations of foreign bribery. In this context, the SEC often will assert that a public company violated these provisions by disguising the illicit transactions in its books and records and by failing to maintain internal controls capable of detecting and preventing such transactions.
The early 2000s were a time of significant turmoil in Corporate America. Otherwise-reputable corporations including Enron, WorldCom and Arthur Andersen came crashing down under the weight of shocking accounting scandals. As billions of dollars in shareholder wealth were wiped out and investor confidence nose-dived, radical measures were needed to close 'creative accounting' loopholes in order to restore credibility in the financial markets. Thus was born the Sarbanes-Oxley Act (or SOX) that was enacted in mid-2002. SOX had a profound effect on how US public companies were governed. Whereas SOX is geared towards streamlining financial reporting, it inadvertently had repercussions in the application of IT security. For organizations to comply with SOX they need to know
what is SOX compliance, and have to align their IT procedures with certain principles of IT security.
China's top state asset regulator on Thursday called on centrally administered state-owned enterprises (SOEs) to improve internal control, so as to fence off risks amid a prolonged trade war and mounting downward pressure. Central SOEs should seek more efficient supervision on operations, including major businesses, operational links, key overseas assets, according to an implementation guideline issued by the State-owned Assets Supervision and Administration Commission (SASAC) on Thursday. The guideline stresses the importance of rolling out more stringent accountability measures and making clear the risk-management responsibility of executives of the enterprises. Information technologies will be taken as important means to improve internal controls. Information systems will be integrated to reduce human errors, said the guideline.
DHS Flagged for IT Control Weaknesses in Outside Audit
meritalk.com
Nov 20, 2019
A required outside
audit of the Department of Homeland Security (DHS) yielded a "clean" opinion of the agency's financial statements for Fiscal Years 2018 and 2019, but also a finding of "material weaknesses" in the areas of financial controls, and IT controls and financial systems.
According to a report from the DHS Office of Inspector General (OIG), outside auditor KPMG made 28 recommendations to improve the agency's internal controls, and DHS concurred with all of them. "The Department continued its commitment to identifying areas for improvement, developing and monitoring corrective actions, and establishing and maintaining effective internal control over financial reporting this past fiscal year," the OIG said in a Nov. 15 letter explaining the audit results. "Looking forward, the Department must continue remediation efforts and stay focused in order to sustain its clean opinion on its financial statements and obtain a clean opinion on its internal control over financial reporting," the OIG said.
Big profits can fuel bad corporate behaviour, new research shows
Companies that over-perform financially are more likely to breach environmental and social regulations, academic finds
By Ben Butler
theguardian.com
Nov 18, 2019
Hubris and overconfidence caused by excellent financial performance is a major driver of irresponsible corporate behaviour, according to new research. Di Fan, a senior lecturer at the business school of the Australian National University, said his research showed companies making above-average profits were more likely to breach their environmental or social obligations than run-of-the-mill firms.He said internal corporate governance had failed to curb bad behaviour and, based on his earlier research of US companies, fines needed to be increased as much as sixfold to encourage better behaviour.
Tokyo--Japan Display Inc., or JDI, said Thursday a former financial executive embezzled some 578 million yen between July 2014 and October 2018.
The liquid crystal display panel maker dismissed him in December last year and filed a criminal complaint against him. The incident has exposed sloppy internal control at JDI, which remains unable to rehabilitate itself despite repeated financial support from a Japanese government-backed investment fund. The former executive repeatedly placed fictitious orders with a company without substance and made JDI spend money mainly as commission fees. He also converted revenue stamps he procured fraudulently into money. His misconduct came to light following a whistle-blowing report.
NEW DELHI: Over 95 per cent businesses have said good corporate governance practices help organisations achieve better operational and financial results, according to a survey. Besides, 93 per cent corporates identified culture as an important catalyst for implementing strong corporate governance, the survey, conducted jointly by Grant Thornton and Confederation of Indian Indusries (CII), said. The survey covered 107 companies across industries between October 2019 and November 2019. As many as 75 per cent of the respondents believe that mandatory corporate governance practices should be extended to unlisted companies, it added. Stressing on the significance of promoting diversity on boards, 88 per cent of the total firms surveyed said their organisation have a woman director on the board.The other parameters taken in the survey include absence of formal training programmes on corporate governance for the board of directors and key managerial personnel.
"Freedom is the only worthy goal in life. It is won by disregarding things that lie beyond our control."
Epictetus
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The Internal Control Institute™ (ICI) is a worldwide organization devoted exclusively to internal control and corporate governance. The Institute is dedicated to the development of world-class educational programs and best practice guidelines on internal control and corporate governance, based on the Sarbanes-Oxley Act and the COSO internal control framework. Visit us on the web at the Internal Control Institute
Control Chatter is a monthly news summary of the top stories concerning internal control and corporate governance. Control Chatter is prepared by the staff of Internal Control Institute for the benefit of their members and associates. Please consider it for your personal use or pass it on to associates who may have an interest in one or more of the topics by clicking on the Forward email button below.
ICI has entered into an agreement with Internal Control Institute of Botswana (ICI Botswana":) as its representative for Products, Services and Internal Control Certifications (CICS/CICP) in this territory. ICI Botswana will be responsible for all development activities in this area, including professional training and Certification. Individuals or companies interested in internal control training or Certification should contact:
