Editor's note: This is from a May 31, 2006 RFG Research Brief entitled "Sustainable Compliance 101: Continuous Controls Monitoring" by lead analysts John Van Decker and Sara Braunstein
Client Challenge: As firms move into the third year of the Sarbanes-Oxley (SOX) compliance era, senior executives in finance, IT and other lines of business (LOBs) are focusing on sustainable and affordable effectiveness in internal controls surrounding critical business processes. RFG received an inquiry from a client that is challenged with making processes compliant, for fewer dollars and more quickly. The company is trying to determine what to prioritize in terms of making business processes and applications compliance-proof, and wonders if there are any low-hanging fruit that can provide significant business value without major investment. RFG recommended continuous controls monitoring (CCM) solutions to this client, to aid it in meeting The Committee of Sponsoring Organizations of the Treadway Commission (COSO) requirements for financial transactions.Recommendations: Despite recent promises from the U.S. Securities and Exchange Commission (SEC) and the Public Accounting Oversight Board (PCAOB) for clearer guidance for Section 404 compliance, audit committees, internal auditors and other senior parties must seek continuous compliance without wasting resources. According to a recent Financial Executives International (FEI) survey, many firms are hopeful that the SEC will allow auditors to rely more on internal process management that ensures compliance of key financial processes.
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