The Committee of Sponsoring Organizations of the Treadway Commission (COSO), the non-profit dedicated to fighting corporate frauds, is set to issue guidance on blockchain technology.
The Wall Street Journal reported the news on Friday, saying that COSO is expected to issue the voluntary blockchain guidance in the first quarter of 2020. The guidance is aimed at executives in financial services and companies using blockchain technology in their supply chains, Paul Sobel, chairman of COSO, told the news source.
“I want to make sure that we’ve got that properly controlled because it is a very different view of the world when you have distributed ledgers. It isn’t something that is contained in your own system,” said Sobel.
Formed in 1985, COSO is a joint initiative of five private-sector organizations: the American Accounting Association (AAA), the American Institute of Certified Public Accountants (AICPA), Financial Executives International (FEI), The Institute of Internal Auditors (IIA), and the Institute of Management Accountants (IMA).
COSO develops guidance and frameworks that companies use to establish internal controls and manage risks. The organization is reportedly best known for a voluntary risk-management framework it developed after accounting scandals in the early 2000s and updated in 2017.
COSO’s upcoming guidance is designed to help companies apply proper governance measures and controls. “The hope is that it creates a dialogue within the executive ranks, as well as within the board, so that they have a better understanding of, really, what their oversight responsibilities are,” said Sobel.