In 1992, the Committee of Sponsoring Organizations (COSO)
published a report defining internal controls and the criteria
for determining the effectiveness of an internal controls
system. The committee included members of the American Institute
of Certified Public Accountants, the Institute of Internal
Auditors, the Financial Executives Institute, the American
Accounting Association; and the Institute of Management
Accountants. Like the IIA, COSO established a broad definition
of internal controls as: A process, effected by an entity’s
board of directors, management and other personnel, designed to
provide reasonable assurance regarding the achievement of
objectives in the effectiveness and efficiency of operations;
reliability of financial reporting; compliance with applicable
laws and regulations. The COSO report also states that
management is primarily responsible for internal control, but
everyone in the organization shares responsibility. The internal
auditor’s role is to help higher management monitor th