Treadway Commission Risk Management Compliance
Treadway Commission Committee of Sponsoring Organizations
The Treadway Committee was a private initiative that resulted from the passage of the Foreign Corrupt Practices Act in 1977. This act was in turn the result of public and legislative concerns regarding the international actions involving both international bribery and political campaign finance activities in the early and mid 1970's. The committee was formed in 1985 as the National commission of Fraudulent Financial Reporting. It is commonly referred to as the Treadway Committee after its chairman, former Securities and Exchange Commission (SEC) chairman James C. Treadway. (International Financial Risk Institute, no date)
The committee was formed in 1985 to sponsor the National Commission of Fraudulent Financial Reporting Practices and issued its first report in 1987. Based on this report, the Committee of Sponsoring Organizations or COSO was formed. COSO retained Coopers & Lybrand to produce an integrated framework of internal controls for international corporations. (COSO, 2008) It was created in response to the disclosure of various questionable practices of certain large publicly owned companies.
Based on a statement of purpose on the organizations web site, "COSO is dedicated to guiding executive management and governance entities toward the establishment of more effective, efficient, and ethical business operations on a global basis. It sponsors and disseminates frameworks and guidance based on in-depth research, analysis, and best practices."
There is clearly a relationship between the Foreign Corrupt Practices Act 1977 and the Sarbanes-Oxley Act of 2002), which is also known as the Public Company Accounting Reform and Investor Protection Act of 2002, and is commonly referred to as SOX. The stronger SOX initiative resulted from the ongoing deceptive
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