A discussion about internal controls came up recently which reminded me of some work I had done a few years back. In summary, the problem is that most internal control frameworks are designed for corporate entities and specifically US organizations. How applicable are they to a public sector context?

COSO is an internal control framework created as a result of one of the many business ethics events that occurred in the United States in the 1970’s. I won’t recap the history as I covered this in a previous post: Internal Control and COSO.

COSO has several criticisms including its applicability outside of a US based corporation. It is also of limited use to the governments and the public sector. To address these, I proposed COSOPS: COSO for the Public Service. The COSO pedigree is evident from the graphic but there are some critical differences.

COSOPS Focus and Biases

While some of COSOPS is at home in any political system, its basis is that of a liberal democracy. Privacy and Freedom of Information would be foreign concept in many cultures. Abraham Lincoln complained about the numerous ‘hanger ons’ after his election who expected a plum government appointment. The Germans and Chinese mitigated this through exams and a professional civil service.

Additionally, there is also an implicit focus on the national level of government as opposed to lower levels. A national government has some control over the structure of the judiciary, a local town council has none.

Remembering the MCEF Context

Nevertheless, COSOPS is a starting point for governmental organizations interested in a framework to manage their affairs. As a reminder, COSOPS is focused on controls and less so on ability.

This dichotomy was discussed via the Management Control and Enablement Framework (see the graphic below). I will be referring back to MCEF in some future blogs where I will take a deeper dive into each of the COSOPS elements.

Stay tuned and as always, let me know your thoughts. Is COSOPS a viable framework? Can it be measured and the results reported on?