AI Framework: Internal Control Over Financial Reporting Whitepaper

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AI Framework: Internal Control Over Financial Reporting whitepaper was developed by FEI’s Committee on Corporate Reporting (CCR) to help companies integrate artificial intelligence (AI) into financial reporting while maintaining effective internal control over financial reporting (ICFR).

As AI moves rapidly from experimentation into core finance and accounting processes, management teams face a dual challenge: capturing AI’s efficiency and analytical benefits while preserving the reliability of financial reporting that capital markets depend on. The framework provides a practical, principles-based approach for identifying, scoping, and managing AI systems used in financial reporting — whether AI is embedded in a process or relied upon as a control — consistent with the Sarbanes-Oxley Act (SOX) and the COSO Internal Control – Integrated Framework.

The framework was authored by a cross-industry group of corporate controllers, chief accounting officers, and accounting leaders from Fortune 100 and large public companies, with input from academia.

The AI Framework: Internal Control Over Financial Reporting whitepaper is intended to be a living document that will evolve alongside AI technology and regulatory expectations. It does not change the recommended strategy that is becoming increasingly important in the AI world: the need for human oversight in AI-assisted workflows. The AI Framework: Internal Control Over Financial Reporting whitepaper also notes the importance of unsettled legal questions regarding copyright protection and corporate liability in AI-driven actions and outcomes.

The whitepaper is not intended as legal guidance or advice, and it should not be relied upon for decisions that may raise liability concerns. FEI is not responsible for how companies or individuals use the AI Framework: Internal Control Over Financial Reporting. Where questions exist concerning possible legal ramifications, readers of the whitepaper should consult with appropriate legal counsel.