Something to Consider July 2019 3
With each anniversary of SOX, we seem to experience déjà vu, with a recurrent theme every year. The cost, effort and challenges associated with SOX compliance remain heavy for most firms. Yet the world it was born into has changed beyond recognition. Isn’t it about time we caught up? Or better yet, get ahead and drive real business value beyond the ‘insurance policy’ of compliance?
The tenth annual Sarbanes-Oxley (SOX) Compliance Survey identifies 47% of firms are neglecting to adopt the new technologies capable of making the compliance process more efficient and value-adding.
But 46% say its high on their agenda. The good (?) news is the increases in the cost of SOX appear to have stabilised, the bad news is that effort spent on SOX has increased. Sounds like labour arbitrage to me, which is rarely sustainable. For those respondents who said their hours had increased, 59% of those reported the number of hours went up by more than 10% from the prior year.
It’s evident the majority of companies still have a long way to go in their journey towards a more efficient SOX compliance program. Data led automation is driving new levels of efficiency and effectiveness across the business.
Our own perspective and experience leads us to the view that we also need to address financial risk management, control and compliance activities as a global end-to-end process, eliminate the unnecessary, simplify the over-complex and standardise the variants. That way, the value of automation will be orders of magnitude higher. With end-to-end process leadership we can also accelerate the move to shifting more responsibilities and accountabilities to 1st line management, enabling true ‘risk informed decision making’.