Internal Control over Financial Reporting
We provide end-to-end support for organizations to strengthen their Internal Control Over Financial Reporting (ICOFR) framework, ensuring compliance with regulatory requirements and enhancing financial accuracy, transparency, and operational efficiency. Our comprehensive ICFR services include:
1. Policy Writing and Support
Development and documentation of ICOFR policies and procedures tailored to your organization’s operational and regulatory needs.
Aligning policies with COSO (Committee of Sponsoring Organizations) framework, SOX (Sarbanes-Oxley Act) compliance, IFRS, and other applicable financial reporting standards.
Providing guidance on control environment, risk assessment, control activities, information & communication, and monitoring activities to establish a strong internal control structure.
Training and advisory support for management and finance teams on ICOFR best practices and policy implementation.
2. Materiality Analysis and Scoping
Identifying significant financial statement accounts, disclosures, and reporting elements that require ICOFR assessment.
Establishing quantitative and qualitative thresholds for materiality to prioritize control testing efforts.
Defining the scope of ICOFR testing based on entity-level controls, process-level controls, and IT general controls.
Evaluating high-risk areas such as revenue recognition, financial closing & reporting, and key account reconciliations to focus on critical controls.
3. Preparation of Risk Control Matrix (RCM)
Developing a Risk Control Matrix (RCM) to map out key financial reporting risks and their corresponding controls.
Documenting control objectives, control descriptions, frequency, control owners, and test procedures for each financial process.
Classifying controls as preventive vs. detective and manual vs. automated for efficient risk mitigation.
Ensuring linkage of RCM with financial statement assertions (completeness, accuracy, existence, rights & obligations, and valuation).
4. Controls Assessment and Management Testing
Conducting walkthroughs and control testing to assess design effectiveness and operational efficiency of internal controls.
Performing management testing of key controls, including entity-level and process-level controls.
Identifying control gaps, deficiencies, and remediation plans to improve compliance with ICOFR requirements.
Recommending enhancements to control design and implementation to strengthen risk management.
5. Issuing Management Report
Providing a detailed ICOFR assessment report summarizing control effectiveness, testing results, and identified weaknesses.
Preparing remediation plans with actionable recommendations for process improvements and control enhancements.
Offering periodic control status updates to ensure continuous improvement and compliance.
6. Liaison with External Auditors
Coordinating with external auditors to provide necessary documentation and evidence for ICOFR testing.
Facilitating audit readiness by addressing potential control deficiencies before external reviews.
Acting as a bridge between management and auditors to streamline ICOFR compliance efforts and ensure a smooth audit process.
Assisting in responding to audit findings, recommendations, and regulatory inquiries related to financial reporting controls.
Our ICOFR services are designed to help businesses establish a robust internal control framework, reduce financial reporting risks, and meet regulatory expectations with confidence.
