COSO Strengthening ERM for Strategic Advantage
COSO Effective Enterprise Risk Oversight
Developing Key Risk Indicators to Strengthen Enterprise Risk Management
Embracing Enterprise Risk Management
Developing Key Risk Indicators to Strengthen Enterprise Risk Management
Fraudulent Financial Reporting: 1987-1997
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During the mid 1980's when the Treadway Commission initially convened, Michael was a staff Instructor and Manager for the IIA Headquarters. He was very impressed that President Ronald Reagan gave a sincere accolade and congratulation to the Treadway Commission and the related audit professions for their role in helping to curb the sagging economic effects from the frauds of the 1970's. The Foreign Corrupt Practices Act (FCPA) of 1977 was still in its infancy phase and had impacted the internal auditing profession with a spike in demand for internal auditors.
Many of those in the know, much like President Reagan, realized the critical role of strengthening and effectuating a strong system of internal control as the long range solution to the 1980's economic recovery and sustainability. The Treadway Commission's originating participants were representatives from the five professional associations most involved in control reviews and applications and was known as the Committee of Sponsoring Organizations, or what has become the legendary acronym "COSO." Michael closely followed the evolving works of the Committee and applied many of its tenants into his seminars and practice. The original publication in the early 1990's entitled Internal Control - Integrated Framework became the foundation for Michael's course design, delivery and consulting activities since its early publication.
As the Policy Director and then Consultant for the State of Mississippi in the 1990's, Michael participated in the development of two very impacting performance based controls systems. He was an active member of the team that produced the statewide performance based budgeting system to be employed by all state agencies in their budget request process. Then, he partnered with the state's former employee performance appraisal system author to rework the system so that it tied to the agency performance system. In all of these efforts, the tenants of the COSO Framework was applied as the foundation for the system concepts and applications.
Michael has resided in Clinton, Mississippi since 1989 and closely watched the rise and fall of the WorldCom enterprise. In the late 1990's after evolving from the struggling Jackson, MS based Long Distance Dialing Services (LDDS) into the Fortune 100 WorldCom, Inc., the new corporation moved its headquarters literally to the edge of Michael's neighborhood in Clinton, acquiring vacant college land on the neighborhood's perimeter. It was during this time that Michael boldy predicted the demise of the corporation. The signs were too many and obvious. "One day those offices will be for rent," Michael would proclaim to his friends and associates as he pointed to the WorldCom global headquarters. A few years later that was the case.
In 2003 after WorldCom, Enron and the other mammoth schemes brought internal controls, COSO, and auditors to the forefront, Michael was invited to return to the IIA as a contracted Instructor. In his interview with Margie Poposky Bastolla (Manager of In-house Programs at the time), Michael was taken aback when Margie asked him, "Are you familiar with the COSO Framework...can you instruct it?" "Everybody knows about COSO!" was Michael's response. Margie explained the state of the art at the time and the need for training internal auditors in the COSO framework. Since then Michael has been amazed at the ignorance of practicing professionals dealing with the basics of internal control.
His articles will focus on what he has discovered in seminar after seminar in last eight years, and his recommendations for training and applications of the COSO framework. Michael believes internal auditors are the last line of defense before a total collapse of internal controls occurs. His mission is to correct the misnomer of "hard and soft" controls and reintroduce the concept of behavioral controls to build the foundation for understanding the human factors of the control environment and its impact upon the entire control framework.
