What it is
Scoping decides which accounts, disclosures, processes and locations the ICFR evaluation covers. A top-down, risk-based approach starts with the financial statements, identifies significant accounts and their relevant assertions, then maps them to processes and controls. A threshold is only a start. An account below it can still be significant for qualitative reasons.
This workbook screens each account against a threshold set as a percent of materiality, counts five qualitative factors, shows whether it is significant and records the assertions, process and the reason for the scope decision. A Locations tab screens locations by share of revenue and assets.
When to use it
- At the start of each year’s ICFR evaluation.
- After an acquisition, a new system or a change in the business.
- To support the scoping section of the management assessment memo.
What’s inside
- Parameters for materiality and thresholds
- Accounts tab for up to 50 accounts with screen, factors, assertions, process and decision
- Locations tab for 19 locations with revenue and asset shares
- Checks for significant accounts left out of scope without reason
Standard cited
This template follows SOX 404 / COSO risk assessment. It is written in our own words, except for phrases the standard requires the document to contain, with [bracketed placeholders] for client details, amounts in USD and dates as MM/DD/YYYY. Check it against the current standard and your firm’s methodology before use.
Questions
Is a quantitative threshold enough?
No. An account below the threshold can be significant because of fraud risk, estimates, complexity, related parties, high volume or change. The workbook counts those factors and treats any one of them as making the account significant.
What about accounts that are small individually?
Small accounts that share a process can be significant together. Use the Aggregate with option and explain it in the reason column.
Related templates
- SOX 404 Scoping Memo
- Risk and Control Matrix: Financial Close
- SOX Testing Status Dashboard
- SOX 404 Management Assessment Memo
Last updated 11/05/2026. All free templates.