Control Environment

a.  Demonstrates commitment to competence and ethics

b.  Recruitment guided by ethical principles that seek competent individuals

c.  Mgt supports appropriate training

d.  Evaluations and compensation practices support achievement of fin rep obj

a.  Maintain current job descriptions

b.  Maintain current HR procedures

c.  Screen job applicants through reference checks and resume reviews

d.  Establish a review and appraisal process

e.  Design and review comp plans to ensure market rates are paid and that senior mgmt salaries are tied to achievement of non financial goals

f. Regularly evaluate competency of personnel

a.  Competencies necessary for fin rep are identified

b.  Individuals who possess necesary competencies for financial reporting are hired forthat purpose

c.  Needed competencies are regularly evaluated and maintained

a.  Mgt establishes appropriate knowledge, skills & abilities for individuals hired for fin rep responsibilities

b.  Training provided in house

c.  BOD or audit committee regularly evaluates compency of CFO

d.  Mgt provides ongoing evaluation

Resp:

Audit comm oversees mgt process for defining resp for key fin rep roles

Exec mgt responsible for IC over fin rep

Senior and functional mgt responsible forensuring all employees understand resp and adhere to IC

Auth limited by position

Establish clear job descriptions

Document audit committee review of key finance personnel

Employee positions are aligned with appropriate authority

Mgt designs appropriate fin rep structures that provides relevant info at appropriate functional and business unit levels

Mgt maintains org structure that facilitates reporting and other communications regarding IC over fin rep

Org charts

Aligning roles to process

Job descriptions

Org structure

Internal audit

Statements of ethics are clearly articulated

Processes are in place to monitor adherence to ethical values

Departures from ethical conduct are addressed

Articulating and demonstrating integrity and ethics

Informing employees about integrity and ethics

Demonstrating commitment to integrity and ethics

BOD

Operates independently

Monitors risk

Appoints audit committee and at least one member is financial expert

Oversees quality and reliability

Appoints audit committee that oversees audit activities

Establishing standard content and action items at regularly scheduled board meetings

Using national listings from reputable accounting and finance assoc to identify independent and appropriately skilled board members

Establishing audit committee and ensuring they:

Consider effectiveness of IC

Meet with auditors

Review pol & proc

Maintain skepticism

Consider whistle-blower info

Annually certify compliance with statutory and bylaw requirements

Ensuring bylaws and charters describe Board member responsibilities

Conducting portion of each Board meeting with no member of mgt present