Big4Guy

Sometime back, I had written about software tools available for Sarbanes Oxley compliance here. Compliance softwares can be quite helpful to companies subject to Sarbanes Oxley. As many companies approach year three of compliance, their management should aim at building in efficiencies through automation as far as possible. Taking an example of a medium sized company, normally about a 1000 control activities need to be documented. Such documentation for control activities is also required to be shared with external auditors. Sarbanes Oxley softwares leverage documentation and enable sharing of information for internal and external purposes. The right tool can significantly save costs for companies.

Companies thinking of procuring a documentation tool should look for some important features. These I consider as the bare minimum in a internal control management software solution. Depending upon specific requirements, companies can look for more features. Here are some bare minimum functionalities to look for:

1. The tool should provide for documentation of internal controls. Tool should enable documentation to be linked to processes and financial statement of entities.

2. The tool should provide for documentation of assessment of control design.

3. The tool should be able to record results of testing of control effectiveness.

4. One should be able to track the status of improvements in controls design and control effectiveness.

5. Over and above the features mentioned above, the software should have master data which can be maintained for business units, control objectives, control activities, risks, financial statement accounts etc.

6. Finally, no software solution is complete if it does not provide for reporting. SOX tool should have detailed reporting on internal controls, deficiencies noted and the remediation activities planned. In addition, dashboards for middle and senior management can be a very useful feature in the long run.