SOX Pros Say Digital Transformation is the Key Driver to More Efficient SOX Compliance
October 14 2021 - 9:21AM
Business Wire
Sixth Annual Survey Identifies 2021 Trends in
SOX Compliance
- Companies believe they weathered the pandemic well
- Cybersecurity risks are still a top concern for compliance
- Key controls are increasing and revenue is the
driver
- 75% of SOX Pros use multiple technologies for the SOX
processes
- Analytics and automation aren’t yet widely used
The SOX & Internal Controls Professional Group today
released the findings of its sixth-annual State of the SOX and
Internal Controls Market Survey. The survey, which was conducted
with KPMG US and Workiva Inc. (NYSE:WK), asked respondents to weigh
in on technology challenges, key controls, automation and the
effects of COVID-19 on their company’s Sarbanes-Oxley Act (SOX)
compliance.
“SOX compliance has been a fixture in the corporate world for
nearly 20 years, with no sign from regulators that compliance
standards will ease,” said Lauren Uyeno, director of the SOX &
Internal Controls Professionals Group. “Now more than ever, SOX
compliance leaders need to be a strategic partner for the
enterprise; to collaborate across teams and push company leaders to
adopt new, automated technology that will reduce risk and directly
benefit the first line of defense.”
The COVID-19 pandemic created a major disruption for SOX
compliance teams in 2020 and continues to impact business overall
to this day. However, most respondents said their compliance teams
adjusted quite well to working remotely. 53 percent said their
companies moved to a fully remote work policy when the pandemic
hit, while 43 percent adopted a partially remote policy. 48 percent
said their businesses enacted layoffs or furloughs, however 62
percent responded that their SOX compliance teams didn’t suffer any
loss of headcount.
Cybersecurity and IT Controls have historically been among the
top three areas of concern for SOX/IC professionals. These too have
received increased attention during the COVID-19 pandemic and into
2021 as more companies have restructured teams, moved to remote
work, and become more reliant on cloud-based technologies.
This year, respondents reported having more key controls. On
average, respondents had 300 key controls, with the majority
reporting 250 to 300. In contrast, nearly half of last year’s
respondents had less than 250 key controls. Company revenue was a
major driver of increased controls. The average number of key
controls among respondents at companies with less than $700 million
in average revenue was 242. Among respondents at companies with $5
billion or more in average revenue, the average was 536.
Fragmented or inefficient technology continues to be a sore spot
for SOX practitioners. 75 percent said they use multiple systems
for their SOX processes Multiple systems create unnecessary
inefficiencies and increase the risk of mishandling data.
Survey respondents also noted that automation and analytics are
still not widely used. Most respondents said their use of data
analytics in their SOX programs were still at basic levels for
sample selection, scoping, and evaluating severity of control
failures. Two-thirds of respondents said they don’t use bots or
automated routines at all.
“It’s possible that companies are hesitant to embrace automation
because they don’t know where to start,” added Uyeno. “But the
proper implementation of technology can strengthen the control
environment, alleviate staffing challenges, embed compliance
processes into first-line activities, improve reporting and cut
costs.”
About SOX & Internal Controls Professionals Group
The SOX & Internal Controls Professionals Group is a global
community for in-house professionals to promote thought leadership
and create opportunities for members to share best practices with
like-minded professionals to help them increase their value and
influence across their organizations.
These exclusive professional membership organizations represent
more than two-thirds of large U.S. public companies. The
member-based professional group was founded by Workiva Inc.
(NYSE:WK).
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version on businesswire.com: https://www.businesswire.com/news/home/20211014005707/en/
Media contact: Lauren Uyeno SOX & IC Pro Group (714)
642-1532 lauren.uyeno@soxprofessionalsgroup.org
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