Strong systems of internal control over financial reporting (ICFR) are critical to the production of reliable financial statements. Securities and Exchange Commission (SEC) regulations require that companies design, maintain, and regularly evaluate their systems of ICFR, and Auditing Standard No. 5 requires that auditors evaluate companies' systems of ICFR. Therefore, it is necessary for accountants to be able to (1) describe and classify internal controls and (2) determine deficiencies in internal control. Recent reports suggest that accountants may lack sufficient training and guidance in these respects (e.g., Rapoport 2012). This activity provides an opportunity for students to practice these skills while learning more about the Committee of Sponsoring Organizations of the Treadway Commission's (COSO) 2013 Framework.

Provided are a summary discussion of ICFR and the COSO 2013 Framework, an outside-of-class reading assignment, and an activity that requires students (independently or in groups, either in or outside of class) to employ critical-thinking skills to: (1) classify (i.e., map) a listing of controls as being aligned with one (or more) of the COSO 2013 Framework's five components and 17 principles that comprise a well-designed system of internal control, and (2) identify any deficiencies (gaps) in design due to missing or inadequate internal controls.

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