The Unexpected Benefits of Sarbanes-Oxley

April 2006 form Harvard Business Review courtesy of Approva Corporation – This article is about:

• Control environment (attitude, values, transparency…) is the 1st line of control defense
• Reducing control testing based on risk of a particular process leading to material errors
• Avoiding duplication of work when it comes to documenting business process. In one example, a company’s processes were being reviewed for Sarbanes-Oxley and for ISO 9000. There were 2 different teams documenting the identical business process
• Standardization improves data consistency which reduces the potential for error. Another standardization benefit is that it can lead to efficiencies by streamlining processes. And the auditors only need to review one process rather than multiple processes
• Manual controls are not as good as automated controls
• Few companies have used Sarbanes-Oxley as a way to improve business process
  

180 View – It’s about time that the auditors provided more real value in their review of internal controls by identifying weaknesses in efficiency and effectiveness of business process.