There are few absolutes in today’s business rulebook, but here’s one of them: Everything changes — even 21-year-old internal control frameworks.

The Committee of Sponsoring Organizations (COSO) of the Treadway Commission has announced that it will release an update to its landmark Internal Control: Integrated Framework on May 14.

The updated framework will “reflect changes in the business and operating environments, formalize more explicitly the principles embedded in the original framework that facilitate development of effective internal control and assessment of its effectiveness, and increase ease of use when applied to an entity objective,” COSO stated.

And what, you may ask, is the big deal anyway? Why is the framework worth paying attention to? Consider this answer from FEI’s Financial Reporting blog:

“(The framework) is inherently significant to public and private companies as a frame of reference for good corporate governance and internal control.

“It is critically important for all public companies in terms of Sarbanes-Oxley Section 404 internal control assertions, as it is cited in SEC and PCAOB rules for the management report on internal control (Sarbox Section 404a) and auditor’s report on internal control (Sarbox Section 404b), respectively, as a suitable internal control framework.

“Private companies are impacted in a number of ways as well — e.g., if they are contemplating an IPO, or if they engage an audit firm to perform an attestation on their internal controls in conformity with certain AICPA standards referencing COSO’s internal control framework.”

COSO says users should begin moving to the updated framework “as soon as is feasible under their particular circumstances,” though the original 1992 framework will remain available through Dec. 15, 2014.

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