Computerworld -
CEOs and chief financial officers who are obligated by the Sarbanes-Oxley Act to stand behind the financial accounting controls used by their companies are increasingly asking operating units, including IT, to certify that they have put adequate safeguards in place. "I'm hearing a lot of discussion about that," said Chris McLaughlin, global director of financial services marketing at FileNet Corp., a Costa Mesa, Calif.-based software vendor that sells document management tools for use in Sarbanes-Oxley compliance projects. With CEOs and CFOs now being held accountable for the accuracy of the financial reporting at their companies, "they are looking for ways to distribute that responsibility downward through their organizations," McLaughlin said. That includes asking IT managers to certify the systems used to process financial data, he added. Some companies are doing internal audits using certification standards such as SAS 70 to give their IT operations the equivalent of a Good Housekeeping Seal of Approval. SAS 70—known formally as the Statement on Auditing Standards No. 70, Service Organizations—was developed by the New York-based American Institute of Certified Public Accountants. In addition, some outsourcing vendors have started offering SAS 70 audits to their clients. That was an unexpected windfall for Energy Absorption Systems Inc. after the Chicago-based maker of highway crash barriers hired an application service provider (ASP) earlier this year to manage its finance applications. "We see them as another group to help us improve on our internal controls," said Bob Latek, senior vice president and controller at Energy Absorption Systems. Latek, who spoke at an IT conference for CFOs last month (see story), said that letting the ASP run the certification process should help his company cut its Sarbanes-Oxley compliance costs in half "and save us a lot of time, too." Anthony Noble, director of IT audits at Viacom Inc., said that at the next meeting of the company's divisional CIOs in January, he plans to raise the issue of whether the New York-based parent company of MTV, CBS, Blockbuster Video and other entertainment businesses should conduct IT certifications. Noble said he understands the potential usefulness of such certifications as a sort of "life insurance policy." But he added that he's skeptical about the way some big auditing firms are using SAS 70 as a sales tool to generate incremental business through Sarbanes-Oxley consulting deals. Ed Trainor, senior vice president of information systems at Paramount Pictures Corp., a Hollywood-based Viacom unit, said IT certifications "are a commendable thing to do for a variety of reasons." However, they "require a considerable investment, and the benefit must be weighed against other needs and priorities for scarce resources," added Trainor, who is also president of the Chicago-based Society for Information Management. The SAS 70 Type II report that companies can use to document the effectiveness of their internal IT controls will have to be updated to meet requirements specific to Sarbanes-Oxley, such as quantifying the extent of testing done on financial systems, said Lynn Edelson, a Los Angeles-based consultant at PricewaterhouseCoopers.
Accelerate your knowledge of the IT world you inhabit by viewing the results of a series of polls taken by your IT peers. These polls of 100+ IT professionals each are available for full viewing. They cover key topics such as virtualization, processor performance, green IT, cloud computing and many others. Be a part of the buzz.
Technology is complex. Keeping it running productively shouldn't
be. To that end, you want to minimize the number of solutions needed
in-house to simplify operations, maintenance, and support. Kodak offers a
best-practices model. One company provides support for both scanner and
software, for fast problem resolution without vendor finger-pointing. Download now!
Utilizing demand intelligence improves the precision of pricing,
product assortments, channel/store placement, and promotion, which are all
essential for sustainable revenue management performance. Learn more,
download this free whitepaper today.
White Papers & Webcasts
IT Modernization in Government
As IT budgets are slashed, IT management pressures rise and legacy systems linger in government organizations, modernizing the IT infrastructure and applications has...
Strategic ECM Webinar
Learn what new strategic business benefits can be realized through ECM!...
5 Architecture Issues that Impact BES performance
This Live webinar will identify critical log file errors, performance counters, and configurations to pay close attention to when optimizing BES server performance....
The Vector Approach to Data Center Power Planning
This white paper describes an approach that considers the major milestones and thresholds in data center power requirements-and how planners should adjust their...
Usability Is Everything
Learn what sets Workday's HR and Payroll solutions apart from the competition....
The Value of Real SaaS at Workday
Cost savings, speed to value, and innovation brought to the enterprise by Workday's software-as-a-service solutions for HR and Payroll....
See your link here
Subscribe to Computerworld 
