Organization-Guide/Processes/Quality Management/COSO/FSCP.md

Financial Statement Closing Process (FSCP)

No.	Component	Control Area	Question	Answer	Evidences
1	General closing	Principle of financial reporting	Which basic financial reporting policies do you have?	The organization follows the German law regarding financial reporting and has various internal reporting policies and guidelines.	Financial laws (i.e. HGB, AO, Ustg, ...) Policies: Accounting Process: Finance
2	General closing	Understanding accounting policies	Who approves the accounting policies and how are changes implemented?	The company follows the German laws. Internal accounting policies are approved by the CFO. Changes can be implemented by any accounting employee but must be approved by the CFO.	Financial laws (i.e. HGB, AO, Ustg, ...) Policies: Accounting
3	General closing	Accounting manual	Which accounting manuals and related documents exist?	Various accounting policies and a finance process.	Policies: Accounting Process: Finance
4	General closing	Seggregation of duties	How are the duties of posting financial data, collecting financial data and approving financial data for the reporting seggregated?	Financial data is posted by accountants, the collection of financial data is handled by controllers and the approval of the reporting data is performed by the CFO.	Process: Finance
5	General closing	Management of accounting system	What are the accounting systems access control mechanisms and how are they implemented?	The accounting system is username and password protected with access restrictions according to the position and function of every person.	ITGC
6	General closing	Management of accounting system	How is the financial data stored and maintained in the accounting system to prevent them from being altered unauthorized?	Accounting data are stored digitally and can only be accessed and modified based on individual user permissions.	ITGC
7	General closing	Management of accounting system	What are the accounting systems functions to prevent alterations or modifications after the settlement of the accounts?	Accounting periods can be locked preventing further alterations in the accounting system.	Screenshot
8	General closing	Closing schedule	What is your closing schedule and how do you ensure the completion of the closing in time?	The financial closing is on the 5th business day of the following month. This is ensured through sufficient qualified personnel, reporting tools and monthly closing check lists.	Process: Finance Checklists
9	None-consolidation closing	Information and evidence	Do you keep references for financial statements including evidences such as contracts and invoices of significant transactions and how do you store them?	References are stored digitally for at least 10 years according to the German law.
10	None-consolidation closing	Preparation and approval of non-consolidated financial information	How do you prepare figures of accounts, such as allowances, which need accounting estimates?	Estimates are performed based on historic experiences and risk avoidance.	Guidelines: Provisions
11	None-consolidation closing	Preparation and approval of non-consolidated financial information	How do you ensure the completeness and correctness of the journal entries?	Completeness is ensured by comparison to historic and budget figures as well as open orders. Correctness is ensured through comparison with historic and budget figures.	Process: Finance
12	None-consolidation closing	Preparation and approval of non-consolidated financial information	Which financial analysis do you perform (e.g. comparison of actuals and budget/previous year, KPI analysis, ...)?	Actual vs. budget, actual vs. previous year and KPI figures are analyzed.	Process: Finance
13	Reporting package	Preparation and approval of reporting package	How do you ensure the necessary competencies for the employees involved in the creation of the financial closing and financial reporting?	This is done during the HR search and the employee evaluation.	Job description Employee Evaluation Form
14	Reporting package	Preparation and approval of reporting package	Who approves the reporting package or revisions thereof?	CFO
2022-01-01 - Version 1.0