Thursday, December 16, 2004

Line56.com: The Strategy of Controls

Yesterday, a survey showed that Sarbanes-Oxley (SOX) laws are both beneficial and expensive. Today it's time to understand how companies, particularly larger enterprises, can use the systems and processes set up for SOX compliance to generate strategic value and make the benefits outweigh the expenses.

The past several months of SOX activity have been a fire drill. As in the case of other mandates, the first stage has been for impacted companies to comply with the letter of the law, and in the case of SOX this has meant setting up a secure, documented, and accountability-laced control and monitoring regime around financials and related data.

Think of it this way: every controls issue can impact any other area of the business. It isn't just about preventing fraud. If employees bypass existing controls in order to approve their own purchases, the enterprise might have a maverick spending problem. If an employee adds an identifying suffix to a purchase order transaction, the enterprise might develop a duplicate records problem.

Line56.com: The Strategy of Controls

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