COSO Component 3: Control Activities
Policies and Procedures
Control activities are the specific policies and procedures implemented to reduce identified risks. They occur throughout the organization and include both manual and automated controls.
- Authorization and approval controls.
- Segregation of duties.
- Physical safeguards over assets.
- Reconciliations.
- IT application controls.
- Supervisory reviews.
Note
Segregation of duties is one of the most effective preventive controls against fraud.
Summary
Control activities are the day-to-day procedures that reduce the likelihood of errors and fraud.