HELP US IMPROVE INTERNAL CONTROL SYSTEMS WORLDWIDE
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: firstname.lastname@example.org 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: When Will It Be Done?
By Michael Pregmon, Jr., Ph.D., CICP
Dr. Michael Pregmon, Jr. COO and Managing Director
In previous articles on this subject, we introduced the Business Planning process. We stated that an overall plan requires a detailed consideration of seven areas/questions 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
In this edition we will address the sixth section of a business plan.
When Will It Be Done?
This is the section of the plan that often becomes the most challenging because of control. It certainly seems odd for an internal control activity. The common issue faced here is often procrastination. In many cases, the individual responsible for completing the task delays the execution believing it can be completed quickly - only to realize thereafter, this is not the case. And essentially, the target completion date is missed. Similarly, the responsible person may feel the completion of the objective or project is "a piece of cake" - only to realize it is more involved than originally thought. Consequently, target dates are missed or maybe the project is not even completed.
But the most frequent reason for missing a deadline pertains to #4 above.
So often, organizations assign the accomplishment of an objective to more than one person and a date of completion is established in "good faith" by the people involved. However, in many if not most cases the task is not completed on time. It has proven many times over that for projects to be completed effectively and on time, it is best to have one individual person responsible for its completion. And, a specific date should be established for the completion of each objective, project, or task.
How successful were you with your last project deadline?
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:
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:
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 Egypt, Jordan, Libya, Muscat, Sudan, Qatar, the United Arab Emirates, Kuwait and Palestine.
7 - 10 June 2020 - Ramallah, Palestine
21 - 24 June 2020 - Cairo, Egypt
30 August - 3 September 2020 - Amman, Jordan
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:
On Saturday and Sunday 08:30 am - 12:00 am 13:30 pm - 17:00 pm
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.
Risk appetite plays an important role in organizational success and should be considered carefully by leaders as they make strategic decisions. The Committee of Sponsoring Organizations of the Treadway Commission (COSO) has published new guidance on risk appetite focusing on how organizations can promote risk appetite as a key factor in decision-making. "Risk appetite is a fundamental part of setting strategy and objectives, providing context as the organization pursues a given level of performance," COSO Chairman Paul Sobel said in a news release. "What is important is to recognize that the choice of strategies and objectives requires an understanding of the appetite for risk. While most often an organization can adjust to take on more risk, there may be times where it needs to adjust the appetite, or perhaps even strategy, to accommodate a shifting business environment such as the one we are currently experiencing."
Compliance Layoffs, Budget Cuts Raise Prospect of Looser Internal Oversight
By Kristin Broughton
May 25, 2020
Corporate compliance departments are finding themselves in the crosshairs of corporate cost-cutters, raising concerns about the potential for mistakes or misbehavior to go undetected. Layoffs and furloughs in compliance departments have arrived in sectors hardest hit by the coronavirus pandemic, according to consultants, researchers and compliance officers. Companies less affected by the downturn are trimming compliance-related expenses or making preparations for possible budget cuts. Some are choosing not to fill open positions or delaying planned investments in technology. Compliance teams have largely been sheltered from major budget cuts in the past decade, according to Julie Myers Wood, chief executive of compliance and investigations firm Guidepost Solutions. "It's unrealistic to think in a company that has mass layoffs across the board that compliance will be spared," she said. "I think fewer people will be asked to do more."
We're now living in unprecedented times. Step by step, the circumstances surrounding the global health crisis are changing, transforming the way we work and live. Technology has taken centre stage in the success of many companies. Financial institutions were not quick to warm up to the benefits of embedding technology into their compliance processes, but it is finally happening. Innovation is happening faster than ever before, in real-time.
KPMG reckons that, by the end of 2020, RegTech - compliance technology - will make up
34 per cent of all regulatory spending.
What's more, it won't peak there. Spending on compliance technology is predicted to grow by 48 per cent year on year for the next five years. It is clear, compliance departments are about to transform.
Organizational trust may seem like one of the fuzzy concepts in corporate ethics and compliance, something nice to have when times are flush, but nowhere near as important as the command-and-control that companies must have when times are difficult.
That's wrong. In fact, when we look at the hard choices businesses have had to make to survive the COVID-19 crisis, organizational trust has a material impact.
Organizational trust is the confidence employees have that their company will act in ways that are fair and aligned with their own ethical priorities. (And while we use employees for this definition, this holds true for shareholders, customers, business partners, and other stakeholders of any corporate enterprise, too.)
More simply, organizational trust is the employee's belief that the corporate enterprise won't act in some way that betrays their sense of what's right. Even when they might not understand the full picture of what the company is doing, the employee follows the practices and standards of the company anyway, because they believe that their actions will serve a greater common good.
The economic blow and staff reductions suffered by companies in the wake of the pandemic are straining safeguards critical to accurate financial reporting, Financial Executives International warned Thursday.
If left unchecked, lapses in internal controls for financial reporting could delay quarterly and annual reports and lead to a spike in material weakness disclosures-a red flag for investors, the group said in a report highlighting an increased risk of accounting and financial reporting errors in the coming quarters. For many companies, new workflows stemming from the move to kitchens and basements, coupled with furloughed or reassigned staff, has left gaps in important reviews and testing, known as internal controls for financial reporting.
Leaders look around corners. How many times have we heard this? But weren't we talking about preparing for disruption from an unexpected business competitor, or a sudden change in customer expectations due to shifting demographics? Enterprise risk management teams have modeled scenarios such as natural disasters, civil unrest, low interest rates and, yes, even a pandemic. However, most of us were not prepared for a pandemic comparable to the 1918 Spanish Flu. The collective, unprecedented impact of our current environment means it is time to revisit those business models, services and technologies that we always said "will never work."
The eleventh annual
Sarbanes-Oxley (SOX) Compliance Survey, conducted by global consulting firm Protiviti, identified that only 46 percent of audit teams have been utilizing advanced technologies to optimize compliance processes, a decrease from the previous year's survey findings. The longstanding challenges associated with compliance with the Sarbanes-Oxley Act, such as the cost of compliance and reliance on time-consuming manual tasks, are being exacerbated by the COVID-19 pandemic, as finance and audit teams are required to perform audit tasks remotely.
"The tasks associated with SOX compliance continue to be significant and time-consuming," said Brian Christensen, executive vice president and global leader of Protiviti's internal audit and financial advisory practice. "The pandemic brings added burdens to the SOX compliance process, and it will be important for companies to reassess any temporary changes in control design and operation to ensure they continue to be aligned with their risk appetite as the business environment begins to normalize."
The COVID-19 pandemic has and will continue to cause severe economic strain on both large and small companies across the United States, for the foreseeable future. Manufacturers have been forced to temporarily close plants, stores have been shuttered, and consumer demand has weakened. Companies with well-known brands like Neiman Marcus and J. Crew have filed for bankruptcy protection. It's the perfect storm of uncertainty for us all. Needless to say, companies are experiencing significant financial stress and cost-cutting has begun and will be deep. With profit centers making significant cuts, cost centers such as compliance will undoubtedly be at risk and will likely have fewer resources until the economy turns around.
What does this mean for compliance departments of companies that are struggling?
Straight to the point, tough times call for tough measures. Or do they? It all depends on how you define tough measures and how appropriate they really are for the circumstances. As companies currently face a unique situation in modern history and are evaluating continued operations, balancing profits with acceptable levels of loss, functioning with massively more remote work and trying to make up for any economic disruptions, the first thought tends to be "How can we cut costs?"
Is that the right approach? Yes and no. Cost reduction is paramount to offsetting loss of revenue, but careful consideration of which cost centers take the hit and what line items to cut isn't as simple as calculating savings in dollars and cents. Before you redline expenses, take into account the following guidelines so that short-term gains don't create long-term pains.
It takes many good deeds to build a good reputation, and only one bad one to lose it. Benjamin Franklin
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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.