COSO Releases Fraud Risk Management Guide: 2nd Edition
The Fraud Risk Management Guide: Second Edition has been released by the Association of Certified Fraud Examiners (ACFE) and the Committee of Sponsoring Organizations of the Treadway Commission (COSO). This new publication is aimed at assisting organisations in establishing an overall Fraud Risk Management Program. The Guide updates the first edition, published in 2016, and draws from a 2008 publication sponsored by the American Institute of CPAs, the Institute of Internal Auditors, and the ACFE. The newly released Fraud Risk Management Guide: Second Edition updates terminology, incorporates recent anti-fraud developments, and highlights technology trends such as data analytics. COSO has been a leading voice in the domains of internal control, enterprise risk management, and fraud deterrence since its inception. Those who use the COSO Framework will find the Fraud Risk Management Guide: Second Edition familiar as it includes principles and areas of emphasis that align with the internal control framework and principles defined in COSO’s 2013 Internal Control-Integrated Framework (2013 ICIF).
Key updates in the second edition include explaining how fraud risk management relates to and supports fraud deterrence, expanded information on data analytics, and how internal control and fraud risk management are related but different. The Fraud Risk Management Guide provides organisations with examples of essential program components and resources to develop an efficient and effective fraud risk management program. While there is no universal approach to managing fraud risk, following the guidance in the updated guide can enable organisations to design a customised program that caters to their specific needs. The Fraud Risk Management Guide plays an important role in advancing COSO’s objective of enhancing internal control, risk management, governance, and fraud deterrence through thought leadership. It achieves this by aligning with COSO’s existing 2013 Internal Control-Integrated Framework (2013 ICIF) and following its principles and focus areas.
