In SOX Compliance, Use of Data and Automation Can Help With Rising Hours and Control Counts

The Protiviti View,

Seventeen years after the Sarbanes-Oxley Act of 2002, SOX compliance continues to challenge many firms. Though SOX compliance expenses have edged downward during the past year, the costs remain significant for many organizations, especially with respect to the value delivered beyond financial reporting processes. These findings are according to Protiviti’s tenth annual Sarbanes-Oxley (SOX) Compliance Survey.

The survey reveals that nearly half of the audit teams polled are not adopting the advanced next-generation technologies capable of making the compliance process less time-intensive and more efficient. However, companies are aware of the need to automate their programs, and 46% of the 693 respondents reported they plan to discuss the topic with their external auditors during fiscal 2019.

The hours spent on SOX compliance continue to rise. Among companies that reported an increase in their SOX compliance hours, 59% said the number of hours went up by more than 10% over the prior year. This increase reflects the amount of time internal teams and external auditors invest in compliance activities determined by a range of “beyond-SOX” factors, including follow-on effects of Public Company Accounting Oversight Board (PCAOB) inspections, new accounting standards, process and technology changes and more.

The good news is that the technology needed to ease the SOX compliance process is available. Data analytics is the most widely used tool (41%) among those already leveraging technology in their audits, followed by automated process approval workflow tools (38%) and access controls, user provisioning and segregation of duties review tools (36%). With SOX hours and control counts on the rise and increasing pressure from the PCAOB and external auditors, leveraging technology – and developing a technology mindset – is the logical way forward.

This year, the Protiviti survey was conducted with support from AuditBoard, a leading cloud-based audit, risk and compliance software company. Protiviti and AuditBoard recently formed an alliance to collaborate to provide organizations with a comprehensive solution of software, consulting and thought leadership for advancing their SOX and internal audit initiatives.

The survey report is available for complimentary download at www.protiviti.com/soxsurvey. For key findings at a glance, see our video and the inforgraphic below. A free 75-minute webinar will be conducted on June 27 at 9:00 a.m. PDT featuring Brian Christensen, Protiviti’s Internal Audit Global Leader, and guest speaker Tom O’Reilly, AuditBoard director and Internal Audit Practice Leader, along with Protiviti Managing Director Eric Groen and Director Cassie Putnam, sharing more findings from the survey and discussing their implications for SOX compliance and internal audit functions. To join the webinar, please register here.

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