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Update on current board issues: September 2012

Audit committee issues

Compendium for revised COSO internal control-integrated framework available

On September 18 the Committee of Sponsoring Organizations of the Treadway Commission (COSO) released for comment a compendium of approaches and examples to complement the updated Internal Control-Integrated Framework.

The framework compendium (Internal Control over External Financial Reporting: Compendium of Approaches and Examples) was written by PwC as part of the framework update. It illustrates how the principles in the framework can be applied in designing, implementing and conducting internal control over financial reporting.

In preparing the document, COSO and PwC received input from an advisory council and observers from regulatory agencies and standard setters. The compendium is intended to be used in conjunction with the revised framework as it uses the same definitions, components and principles.

As part of its due diligence in updating the framework, COSO is also releasing a "post public exposure" version of the framework, which includes changes incorporating public comments. The organization is also making available the Illustrative Tools for Assessing Effectiveness of a System of Internal Control. [To read the compendium, the revised framework, and the illustrative tools, click here.]

The public comment period for the compendium ends on November 20, 2012.

FASB releases proposed 2013 US GAAP taxonomy

The Financial Accounting Standards Board (FASB) last month released its proposed financial reporting taxonomy for U.S. GAAP. The taxonomy is a list of acceptable codes that can be used for filing financial statements via XBRL (Extensible Business Reporting Language). [Read the FASB's press release and links to download the taxonomy.]

The proposed 2013 taxonomy incorporates accounting standards updates issued and other recommended improvements made since the 2012 taxonomy. It is currently used by issuers filing with the SEC, according to a FASB press release. There are nearly 19,000 labels and descriptions included in the taxonomy that enable users of financial statements to electronically search and assimilate financial data.

The comment deadline for the taxonomy is October 29, 2012. The 60-day comment period is designed to solicit feedback on these updates from users of the taxonomy and to provide SEC filers, service providers, software vendors, and other interested parties the opportunity to become familiar with and suggest revisions to the taxonomy including incorporating new elements for current filings.

The final version of the 2013 taxonomy is expected to be published in early 2013.