Friday, May 19, 2006
Lowering SOX Costs Through Scope Reduction
Here's a great piece from AMR Research on the changing methods for attaining SOX compliance.
Compliance costs for the Sarbanes-Oxley Act (SOX) remain in the $6B range for this year, decreasing ever so slightly from the prior year (see the AMR Research Alert article "SOX Spending for 2006 To Exceed $6B"). The appropriate use of technology can automate a lot of the activities done manually today, saving precious time and money. But there is another route to keeping a lid on expenses: reducing the scope of SOX-related work.
Taking a risk-based approach
Just about a year ago, the Public Company Accounting Oversight Board (PCAOB) issued advice to public companies that many have taken to heart: a risk-based approach should be used to determine the breadth and depth of any internal control work to support the constructs of SOX. The result has been that many companies have continuously streamlined their control frameworks to reflect this risk approach. This has, however, been an intellectual exercise, not one driven by technology.
posted by Brian Moran @ 2:51 PM