What Can The External Auditor Expect During Managements First Year Of Compliance?
For years beginning on or after December 15, 2007, management is required to make an assertion about the effectiveness of internal controls over financial reporting (ICFR) with the filing of Form 10-K. Although there is no requirement for an attestation by the company’s external auditor for this period, the external auditor must still validate certain information contained within Form 10-K. Accordingly, management can expect that the auditor will want to review some of the documentation relating to management’s assessment process. According to the SEC guidance, management should complete its assessment using a suitable framework for effective internal control. The primary objective of the assessment process is to ensure that management considered the risk of material misstatement to the organization’s financial statements and evaluated the design and operating effectiveness of controls in place to mitigate those risks. There is no requirement for management to document every control wi
