Automation in Finance – A question of when rather than if

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Bill Gates famously said “The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.” Coming from the founder of the largest software company in the world - Microsoft. Read more >>




Compliance Management Software – A new horizon

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With the advent of new compliance requirements such as Internal Financial Controls (IFC) in India, the need of the hour is an effective compliance management software that will help management seamlessly plan and execute key tasks. The capability to dynamically manage team members, effortlessly generate status reports and automatically analyze big data sets Read more >>

With the advent of new compliance requirements such as Internal Financial Controls (IFC) in India, the need of the hour is an effective compliance management software that will help management seamlessly plan and execute key tasks. The capability to dynamically manage team members, effortlessly generate status reports and automatically analyze big data sets is a major advantage to any compliance function. Efficient resource planning ensures engagements are successfully completed within deadlines while embracing best-in-class project management techniques. Coordination with process owners becomes easier through reducing inefficient communication/document-sharing channels such as emails and shared folders. Further, the automatic report generation feature makes it really simple to generate recommendation reports using pre-defined templates.

In addition to the features mentioned above there are a few dominant trends that motivate management to adopt compliance and audit software.

Intuitive status tracking and reporting

Spreadsheets are the most popular software used by auditors and compliance officers to plan and execute audits. However, spreadsheets actually cause more harm than good while performing critical tasks in the organization. The biggest problems arise due to the restricted ability to view live statuses and to review previous versions of a task. A good testing software, generally, includes a visually graphic dashboard containing pie charts, bar graphs etc., which gives a quick snapshot of the current status of testing. Further, the latest web applications are designed with an elegant, non-cluttered interface and are easy to navigate across pages, in contrast to the endless tabs present in an audit test spreadsheet.

Cloud-based SaaS applications

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The cloud based software deployment model is becoming more relevant as audit and compliance teams are more frequently working from remote locations and using mobile devices to conduct audits. IDC predicts that the demand for SaaS enterprise applications is accelerating and exceeding the demand for on-premises applications by five times (during the five-year forecast period through 2018, SaaS revenue is forecast to grow at 17.6% CAGR, while on-premises revenue growth is only forecast at 3.1%).

Value added offerings

The latest compliance and audit softwares efficiently perform standard tasks such as scoping, planning, resource allocation, testing and reporting. But, in addition to these tasks they also perform functions such as data analysis, trend forecasting, evaluating key performance indicators etc. These features greatly enhance the quality of reports and also help management with decision-making. Gartner predicts that by 2020 at least 60% of audit management software will embed data analysis capabilities in their software compared to 25% right now.

These trends clearly indicate a shift in compliance and audit management towards more transparent, coordinated and data-driven audits. Management is cognizant of the increasing complexity in financial transactions and, realize the need to adopt more scientific audit methods to identify irregularities. Aided by the recent advancements in SaaS applications, the new generation of compliance and audit management software is sure to help management rise to this challenge.




Internal Financial Controls – The Internal Control revolution in India

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In the early years of the 21st century, a new legislation introduced in the United States brought about radical reforms in the area of corporate compliance. The Sarbanes-Oxley Act (popularly known as SOX), signed on July 30, 2002, was designed primarily to safeguard investors by improving the accuracy and reliability of corporate disclosures. Read more >>

In the early years of the 21st century, a new legislation introduced in the United States brought about radical reforms in the area of corporate compliance. The Sarbanes-Oxley Act (popularly known as SOX), signed on July 30, 2002, was designed primarily to safeguard investors by improving the accuracy and reliability of corporate disclosures. The Act was enacted as a reaction to a number of major corporate and accounting scandals in the US, including Enron and WorldCom. Arguably, over the last 14 years, this legislation has made immense contributions in generating greater focus on improved corporate governance and stronger ethics programs in the United States.

Inspired by what US regulators have achieved in the past and concerned with weaknesses in the existing Corporate Governance structure in India, Indian legislators instituted several new measures through the Companies Act 2013. One such landmark initiative was the requirement of Internal Financial Controls (IFC) for all Indian companies. Under Section 143(3)(i) of the Companies Act 2013, Statutory Auditors are required to make a statement in their Auditors Report, whether the company has adequate IFC system in place and whether such controls are operating effectively.

Applicability and Responsibilities

Initially there was some ambiguity on the applicability and reporting of Internal Financial Controls. To provide more operational clarity on this new regulation, the Institute of Chartered Accountants of India (ICAI), in September 2015, issued a detailed guidance note on Audit of Internal Financial Controls over Financial Reporting. As per ICAI, Internal Financial Controls shall mean:

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“the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.”

Internal financial controls over financial reporting is mandatory for both public as well as private companies in India. This broadens the gamut of organizations that will be required to be compliant under this new regulation.

The responsibilities of the key stakeholders in the IFC compliance process are now clearly laid out:

Directors: Ensure adequacy and operating effectiveness of IFC

Audit Committee: Evaluate adequacy and operating effectiveness of IFC

Auditor: To comment on adequacy and operating effectiveness of IFC

Operating Effectiveness

Performing operating effectiveness testing is critical in identifying potential deficiencies in the internal control framework and developing appropriate remediation measures. From the United States experience we have learned that ensuring operating effectiveness of internal controls is a gradual process rather a one-time phenomenon. It will take concerted planning effort on behalf of the management and other stakeholders to ensure effective implementation of IFC going forward.

A good automation solution could be a boon in operating effectiveness testing, especially with the volume of documentation, coordination and reporting involved in the process. Quikprocess aims to be a trusted partner to companies looking to automate their operating effectiveness testing for IFC. Our deep domain expertise and cutting-edge technology will ensure that the company saves time and costs in IFC compliance.




Budget Highlights - Transform, Energise and Clean India (TEC)

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Budget 2017 has attempted to push reforms in major areas while carefully balancing the fiscal needs of the economy. It aims to further the Digital India Programinitiated by the Prime Minister. Here are some of the key provisions highlighted in the budget: Read more >>

In the early years of the 21st century, a new legislation introduced in the United States brought about radical reforms in the area of corporate compliance. The Sarbanes-Oxley Act (popularly known as SOX), signed on July 30, 2002, was designed primarily to safeguard investors by improving the accuracy and reliability of corporate disclosures. The Act was enacted as a reaction to a number of major corporate and accounting scandals in the US, including Enron and WorldCom. Arguably, over the last 14 years, this legislation has made immense contributions in generating greater focus on improved corporate governance and stronger ethics programs in the United States.

Inspired by what US regulators have achieved in the past and concerned with weaknesses in the existing Corporate Governance structure in India, Indian legislators instituted several new measures through the Companies Act 2013. One such landmark initiative was the requirement of Internal Financial Controls (IFC) for all Indian companies. Under Section 143(3)(i) of the Companies Act 2013, Statutory Auditors are required to make a statement in their Auditors Report, whether the company has adequate IFC system in place and whether such controls are operating effectively.

Applicability and Responsibilities

Initially there was some ambiguity on the applicability and reporting of Internal Financial Controls. To provide more operational clarity on this new regulation, the Institute of Chartered Accountants of India (ICAI), in September 2015, issued a detailed guidance note on Audit of Internal Financial Controls over Financial Reporting. As per ICAI, Internal Financial Controls shall mean:

photo

“the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.”

Internal financial controls over financial reporting is mandatory for both public as well as private companies in India. This broadens the gamut of organizations that will be required to be compliant under this new regulation.

The responsibilities of the key stakeholders in the IFC compliance process are now clearly laid out:

Directors: Ensure adequacy and operating effectiveness of IFC

Audit Committee: Evaluate adequacy and operating effectiveness of IFC

Auditor: To comment on adequacy and operating effectiveness of IFC

Operating Effectiveness

Performing operating effectiveness testing is critical in identifying potential deficiencies in the internal control framework and developing appropriate remediation measures. From the United States experience we have learned that ensuring operating effectiveness of internal controls is a gradual process rather a one-time phenomenon. It will take concerted planning effort on behalf of the management and other stakeholders to ensure effective implementation of IFC going forward.

A good automation solution could be a boon in operating effectiveness testing, especially with the volume of documentation, coordination and reporting involved in the process. Quikprocess aims to be a trusted partner to companies looking to automate their operating effectiveness testing for IFC. Our deep domain expertise and cutting-edge technology will ensure that the company saves time and costs in IFC compliance.





Bringing transparency through increased compliance norms – ‘A new India’

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Over the last few years, there has been a concerted effort to bring greatergovernance and transparency measures in the Indian Corporate ecosystem. Certain bottlenecksimpeding GDP growth, which were being overlooked for many years, have now been revisited and given a new Read more >>

In the early years of the 21st century, a new legislation introduced in the United States brought about radical reforms in the area of corporate compliance. The Sarbanes-Oxley Act (popularly known as SOX), signed on July 30, 2002, was designed primarily to safeguard investors by improving the accuracy and reliability of corporate disclosures. The Act was enacted as a reaction to a number of major corporate and accounting scandals in the US, including Enron and WorldCom. Arguably, over the last 14 years, this legislation has made immense contributions in generating greater focus on improved corporate governance and stronger ethics programs in the United States.

Inspired by what US regulators have achieved in the past and concerned with weaknesses in the existing Corporate Governance structure in India, Indian legislators instituted several new measures through the Companies Act 2013. One such landmark initiative was the requirement of Internal Financial Controls (IFC) for all Indian companies. Under Section 143(3)(i) of the Companies Act 2013, Statutory Auditors are required to make a statement in their Auditors Report, whether the company has adequate IFC system in place and whether such controls are operating effectively.

Applicability and Responsibilities

Initially there was some ambiguity on the applicability and reporting of Internal Financial Controls. To provide more operational clarity on this new regulation, the Institute of Chartered Accountants of India (ICAI), in September 2015, issued a detailed guidance note on Audit of Internal Financial Controls over Financial Reporting. As per ICAI, Internal Financial Controls shall mean:

photo

“the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.”

Internal financial controls over financial reporting is mandatory for both public as well as private companies in India. This broadens the gamut of organizations that will be required to be compliant under this new regulation.

The responsibilities of the key stakeholders in the IFC compliance process are now clearly laid out:

Directors: Ensure adequacy and operating effectiveness of IFC

Audit Committee: Evaluate adequacy and operating effectiveness of IFC

Auditor: To comment on adequacy and operating effectiveness of IFC

Operating Effectiveness

Performing operating effectiveness testing is critical in identifying potential deficiencies in the internal control framework and developing appropriate remediation measures. From the United States experience we have learned that ensuring operating effectiveness of internal controls is a gradual process rather a one-time phenomenon. It will take concerted planning effort on behalf of the management and other stakeholders to ensure effective implementation of IFC going forward.

A good automation solution could be a boon in operating effectiveness testing, especially with the volume of documentation, coordination and reporting involved in the process. Quikprocess aims to be a trusted partner to companies looking to automate their operating effectiveness testing for IFC. Our deep domain expertise and cutting-edge technology will ensure that the company saves time and costs in IFC compliance.