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SAP Adds Internal Controls to Finance

It's not enough for companies to say they are meeting the compliance measures imposed as part of the Sarbanes-Oxley Act (SOA), they have to prove it. SAP officials announced Monday new tools that further standardize and provide internal checks within the corporation.

Available early next year, the software integrates with the current version of mySAP Financials and gives CFOs and CEOs functionality to show its internal controls are working, as required in section 404 of the SOA.

Going beyond "mere documentation," according to the announcement, the tools -- which provide scoping, documentation, remediation and sign-off functionality -- SAP officials said the software can be further used by external auditing companies.

"By extending functionality in mySAP Financials and mySAP ERP to comprehensively cover Sarbanes-Oxley requirements, SAP helps companies reduce costs for compliance while leveraging these investments to improve business insight and performance across key business operations," said Jim Hagemann Snabe, SAP financial and public services chief operating officer, in a statement Monday.

A new whistle-blowing function lets employees send anonymous emails through the company portal to executives, a copy of which is stored in the central database, according to requirements in SOA's section 301. The tool can be tied in with the mySAP HR software found in its enterprise resource planning (ERP) software suite.

Last month, SAP started selling its audit information system, a workbench application for C-level executives and external and internal auditors to more quickly sign off and close the books on quarterly and annual reports.

Software vendors are capitalizing on the business world's need for in-depth SOA compliance tools. Nor is SAP the only company coming up with solutions to the problem; Oracle announced Monday SOA compliance enhancements to its own software, OracleO Treasury, adding more internal controls as well as asset-forecasting abilities.

SAP went to PriceWaterhouseCoopers, the noted financial services company, for help designing the new functionality in the software. The company went after addressing the specific sections within the SOA that dictate internal control measures within the corporation.

The company released the results of a survey it conducted in July. Adding internal controls was found by 76 percent of the respondents as the biggest cost for SOA compliance. Many companies expect SOA compliance to take up a little more than 10 percent of their management controls budget in the next couple years.

The total cost, however, seems largely dependent on the size and of the company and what they had in place before passage of the Act.

"Larger companies with a well-established corporate recording infrastructure are better able to handle the added certification and disclosure requirements of the new law," said the survey's author Frank Brown. "For smaller companies, compliance has been more of a burden."



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