How To Increase SOX Compliance?
Powerful software, good procedures and employee training is the key for successful ERP implementations. Robust ERP software packages make it easier to achieve compliance with internal controls such as segregation of duties, financial oversight and approved workflows.
What is SOX Compliant?
Contrary to popular belief, however, ERP systems can’t always force compliance. The significance of the word compliance in financial controls was popularized by SOX Compliance. The term SOX Compliance first appeared after the Enron scandal to address fraud and internal control weaknesses. Unless you are a public company or an auditor you may not have hear of SOX Compliance. SOX is an abbreviation for Sarbanes-Oxley (SOX) and is USA legislation passed in 2002. The requirements of Sarbanes-Oxley forced companies to rethink their processes and technology.
Senior Management is ultimately responsible for implementing Internal Controls.
Since 2002, ERP software companies strived for SOX compliance amongst their customers. No ERP system however, can assure 100 percent compliance. It depends upon internal controls, such as segregation of duties, financial visibility, operations’ workflow and quality assurance. Senior management is ultimately responsible for its own internal controls.
Does Your ERP Software Assist with Implementing Internal Controls?
Good ERP software assists senior management with the tools to implement internal controls for the purposes of financial transparency. Companies with the most foresight take it upon themselves to adopt measures mandated by SOX whether they are private or public corporations. It makes good business sense.
ERP Support for SOX Compliance
The following categories are crucial to help your organization determine whether their ERP is rigorous enough to support the most stringent control frameworks, for example, SOX compliant.
A robust security system for your ERP software is essential for SOX compliance.
Your ERP software tracks whether information comes from a reliable and trusted source. Only designated people can post or alter information.
Information is only accepted when entered in the correct format. Furthermore, information may be entered once and duplicate entries rejected.
- Audit Trail
All transactions are backed up with full transaction tracking. Additionally, a log of users, their sessions and transactions is monitored for inconsistencies in the system. Audit-trails highlight who made changes and when.
How We Can Help?
At Synchronous, the standard for transparency and compliance has always been high. The goal is always to close any possible loophole or possible breakdowns in business process. It is this high standard for seamless and rigorous controls throughout the system that aid organizations in their quest for successful ERP implementations.