NewsDude
06-26-2008, 02:40 PM
With Sarbanes-Oxley (SOX) compliance spending estimated at more than $6 billion in 2007, companies would be wise to ensure that this money is not being wasted. Many see SOX solely as a burden, but the resources used for compliance provide opportunities to improve operations. Smart companies have successfully automated workflows, reduced errors and turnaround time of processes, and redesigned workflows to improve efficiency by implementing the following measures.
Analyzing Business Processes
There are striking similarities between Six Sigma's proven process improvement methodology, DMAIC (define, measure, analyze, improve and control), and compliance activities such as controls documentation, testing and remediation. Both require definition of objectives, measurement of performance, remediation of weaknesses and continual monitoring. Companies that have already performed documentation and testing activities for compliance are in an excellent position to identify process improvement opportunities.
In the billing process, for instance, a key objective is to accurately invoice customers. By documenting and testing the billing process, companies can identify key performance indicators to measure the health of their billing process. An analysis of billing errors can streamline the process.
Automating Processes
Companies should focus on automating processes rather than automating controls. Process automation streamlines the entire chain of activities and enhances the reliability of process outputs. An automated procurement tool, for instance, can automate purchase requisitions, approvals and recording of goods received at the warehouse. This system can help reduce turnaround times for procuring raw materials and associated inventory holding costs.
Automation also enhances internal controls over financial reporting (ICFR) by ensuring that purchase orders are not processed prior to approval, incoming materials match the quantities ordered and payment is made only for materials received. Process automation not only improves operational efficiencies but produces more accurate financial statements.
Automated processes can also curtail operational losses. In a high-volume process such as payments to vendors, it is...
More... (http://www.toptechnews.com/story.xhtml?story_id=60461)
Analyzing Business Processes
There are striking similarities between Six Sigma's proven process improvement methodology, DMAIC (define, measure, analyze, improve and control), and compliance activities such as controls documentation, testing and remediation. Both require definition of objectives, measurement of performance, remediation of weaknesses and continual monitoring. Companies that have already performed documentation and testing activities for compliance are in an excellent position to identify process improvement opportunities.
In the billing process, for instance, a key objective is to accurately invoice customers. By documenting and testing the billing process, companies can identify key performance indicators to measure the health of their billing process. An analysis of billing errors can streamline the process.
Automating Processes
Companies should focus on automating processes rather than automating controls. Process automation streamlines the entire chain of activities and enhances the reliability of process outputs. An automated procurement tool, for instance, can automate purchase requisitions, approvals and recording of goods received at the warehouse. This system can help reduce turnaround times for procuring raw materials and associated inventory holding costs.
Automation also enhances internal controls over financial reporting (ICFR) by ensuring that purchase orders are not processed prior to approval, incoming materials match the quantities ordered and payment is made only for materials received. Process automation not only improves operational efficiencies but produces more accurate financial statements.
Automated processes can also curtail operational losses. In a high-volume process such as payments to vendors, it is...
More... (http://www.toptechnews.com/story.xhtml?story_id=60461)