SOX drives greater value for CEO, CFO in 2020?
The COVID-19 crisis really does highlight to us the importance and value of managing financial risk and controls effectively.
The 2020 State of SOX and Internal Controls Report presented us with some eye-catching insights. 428 professionals responded, so I’d say it’s fairly credible.
Here’s some of the key findings:
There are some other intresting observations too;
• C-suite (senior executives e.g. CEO, CFO, and COO) are placing even higher value on SOX and the financial risk management and control processes
•Efficiency, cybersecurity, and regulatory compliance reign as top 3 priorities
•Financial governance and control leaders are optimizing SOX to add value
•No silver bullets in technology despite the hype
The “elder statesmen” of governance, risk management and compliance, Norman Marks (“less of the ‘elder’” I hear him shout) makes some great observations on the research and report also.
- Whilst the survey reports a correlation between the number of controls and company revenue, this represents a process improvement opportunity as this correlation should not be linear
- While 48% of the respondents have 250 or fewer key controls, 15% have more than 1,000. Gulp! Understandably, 60% say they are focused on control optimization and 53% on control rationalization
- 12% say they have implemented continuous control monitoring for SOX and 56% are considering it. Norman makes the point in differentiating controls monitoring from data analysis. Just because the data is without error doesn’t mean that any controls were executed, effectively or otherwise. Good catch Norman!