Companies Moving to Comply With Sarbanes-Oxley
Forty percent of surveyed CFOs and IT executives expect to upgrade their financial systems and process.
(Newstream) -- Software maker PeopleSoft Inc. has announced the results of a new survey of CFOs and IT executives about their strategies to comply with the Sarbanes-Oxley Act of 2002. More than 880 CFOs and senior IT executives participated in the survey as part of a June seminar on best practices for Sarbanes-Oxley compliance sponsored by PeopleSoft and Business Finance Magazine. The record turnout for the seminar and the survey findings demonstrate that companies are moving quickly to address compliance, and that they are using Sarbanes-Oxley as a catalyst to upgrade finance systems and improve business process efficiencies.
META Group analyzed the survey results and John Van Decker, META Group's vice president of technology research services, commented: "Companies are seriously concerned that they don't have the appropriate internal controls and financial management processes in place to comply with Sarbanes-Oxley. In fact, almost 90 percent of the companies surveyed are already engaged in evaluating or implementing a Sarbanes-Oxley project, and 40 percent intend to upgrade current processes and systems in their compliance efforts."
The following survey results highlight the top compliance strategies and initiatives that companies are pursuing to meet new Sarbanes-Oxley mandates:
- Eighty-six percent of respondents were already engaged in evaluating or implementing a Sarbanes-Oxley project, with 56 percent planning to implement a Sarbanes-Oxley solution in the next three to six months.
- Seventy-one percent believe that Section 404, which requires business process audits and documentation to support internal controls certification, is the most critical part of the Sarbanes-Oxley Act.
- Sixty-five percent will seek to leverage their Sarbanes-Oxley initiatives to achieve process improvements that will increase business efficiencies and competitive advantage. Fifty-four percent are moving forward with their Section 404 compliance initiatives, despite the SEC's May decision to extend the compliance deadline to June 15, 2004. Public companies with a fiscal year ending on or after June 15, 2004 must now include a management report on internal controls in their annual report.
- Forty percent of respondents believe that they will need to upgrade current financial processes and systems to comply with Sarbanes-Oxley. Top initiatives under consideration include: business performance management solutions; internal compliance dashboards/portals; enabling workflow; replacing/upgrading finance systems; and consolidating ERP instances.