By steeping themselves in a "stew" of audit and control software vendor surveys and interviews, the authors of a new guide, The 2005 Buyer's Guide To Audit, Anti-Fraud, and Assurance Software, outline three best practices:

 

Software development lifecycles have matured over time to arrive at a common best practice: "know what you want long term and build iteratively each day to get there". And isn’t this simply common sense that you would employ if you are building a career, a financial plan, or in this case, the integration of technology into a business process.

 

Taking these lessons and relating them back to your next audit or control software implementation, a few suggestions can be made:

 

Many companies will simply rush to add technology feeling it will solve a problem, only to find that the problem has not been lessened.  This can be explained by the fact that most people work still on instincts rather than rational and planned thought. The instinct to panic and implement "software" because they are facing a challenging documentation project or a performance objective by year-end rarely works.

 

In the panic, people normally forget the interdependency relationship and thus do not realize that they must first understand the process, understand the people, and improve the process as best as possible before layering technology. Therefore, a company planning on implementing enterprise risk management should first map out the competencies people need to enact this change, develop a process that will be accepted by the organization, and THEN implement technology.

 

Companies should start as soon as possible in thinking how their technology components will integrate together. This could be accounting system data they are analyzing or control testing documentation systems that need to "talk" to one another. While sounding futuristic, all of the technology to complete this task currently exists. Some vendors are even starting to partner their products together (i.e., integrating risk management and audit workpaper systems) or with other vendors (i.e., data analysis vendors working with audit workpaper vendors). The reality though is that we are still at the early stages of integration which means that the benefits of automation are mostly still yet to be realized.

 

For more best practices, industry trends, and over 100 vendor profiles, see The 2005 Buyer’s Guide To Audit, Anti-Fraud, and Assurance Software.

 

RICH LANZA, CPA, CFE, PMP, is President of Cash Recovery Partners, LLC. He is the author of 12 publications and training courses in ACL, IDEA, Access, ActiveData, and Excel and has over 50 articles for major audit publications. For more information or to contact Rich, visit his SmartPros column, The Bottom Line.