Accounting
COSO offers governance framework for robotic process automation
The Committee of Sponsoring Organizations of the Treadway Commission published a framework for imposing internal controls over robotic process automation.
COSO is jointly sponsored by the American Accounting Association, the American Institute of CPAs, Financial Executives International, the Institute of Management Accountants and the Institute of Internal Auditors.
The publication,
Robotic process automation relies on computers to perform repetitive, rules-based tasks that have traditionally been performed by humans. However, the COSO paper notes that RPA technology comes with significant governance and control challenges that should be addressed to maximize RPA’s benefits while mitigating the associated risks.
The white paper provides a guide for integrating RPA governance requirements with the COSO Internal Control Integrated Framework. COSO’s RPA governance framework identifies several governance areas and control requirements to address common challenges associated with RPA, including security vulnerabilities, process knowledge loss and uncontrolled bot proliferation. RPA offers significant advantages, but also introduces risks such as inconsistent bot deployment, increased potential for security breaches, and difficulties in scaling automation efforts.
“The integration of RPA governance principles with the COSO-ICIF framework is an important step for organizations looking to not only leverage the benefits of automation but also maintain a robust system of internal controls,” said COSO executive director and chair Lucia Wind in a statement Thursday. “This publication provides practical strategies and best practices for ensuring that RPA implementations align with established governance principles, thus protecting organizations from emerging risks and enabling long-term success.”
COSO acknowledged that RPA offers organizations significant efficiency, cost savings and accuracy improvements, but warned that it also introduces some unique governance and internal control challenges. RPA provides ease of use, low cost, and scalability but that can lead to ad-hoc implementations that bypass traditional IT governance frameworks, creating potential security risks and operational inefficiencies. The paper discusses how organizations can align RPA governance with the five key components of the COSO-ICIF framework: control environment, risk assessment, control activities, information and communication, and monitoring activities.
“By addressing each component of the COSO framework in relation to RPA, organizations can develop a holistic approach to governance that supports both innovation and control,” Wind stated.
By mitigating the various risks through a structured internal control framework, organizations can make sure their RPA initiatives contribute to overall operational effectiveness while maintaining a high standard of governance and risk management.
Easing restrictions, sharpening personal attention and clarifying denials are among the aims of
The programs focus on “fast track settlement,” which allows IRS Appeals to mediate disputes between a taxpayer and the IRS while the case is still within the jurisdiction of the examination function, and post-appeals mediation, in which a mediator is introduced to help foster a settlement between Appeals and the taxpayer.
The IRS has been revitalizing existing ADR programs as part of transformation efforts of the agency’s new strategic plan, said Elizabeth Askey, chief of the IRS Independent Office of Appeals.
“By increasing awareness, changing and revitalizing existing programs and piloting new approaches, we hope to make our ADR programs, such as fast-track settlement and post-appeals mediation, more attractive and accessible for all eligible parties,” said Michael Baillif, director of Appeals’ ADR Program Management Office.
Among other improvements, the pilots:
- Align the Large Business and International, Small Business and Self-Employed and Tax Exempt and Government Entities divisions in offering FTS issue by issue. Previously, if a taxpayer had one issue ineligible for FTS, the entire case was ineligible.
- Provide that requests to participate in FTS and PAM will not be denied without the approval of a first-line executive.
- Clarify that taxpayers receive an explanation when requests for FTS or PAM are denied.
Another pilot, Last Chance FTS, is a limited scope SB/SE pilot in which Appeals will call taxpayers or their representatives after a protest is filed in response to a 30-day or equivalent letter to inform taxpayers about the potential application of FTS. This pilot will not impact eligibility for FTS but will simply test the awareness of taxpayers regarding the availability of FTS.
A final pilot removes the limitation that participation in FTS would preclude eligibility for PAM.
The traditional appeals process remains available for all taxpayers.
Inquiries can be addressed to the ADR Program Management Office at
The Internal Revenue Service has updated and added new guidance for taxpayers claiming the Energy Efficient Home Improvement Credit and the Residential Clean Energy Property Credit.
The updated
New sections have been added on how long a taxpayer has to claim the tax credits, guidance for condominium and co-op owners, whether taxpayers who did not previously claim the credit can file an amended return to claim it, and a series of questions on qualified manufacturers and product identification numbers. Other material has been added on how to claim the credits, what kind of records a taxpayer has to keep for claiming the credit, and for how long, and whether taxpayers can include financing costs such as interest payments in determining the amount of the credit.
The IRS states that “financing costs such as interest, as well as other miscellaneous costs such as origination fees and the cost of an extended warranty, are not eligible expenditures for purposes of the credit.”
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