 The US Public Company Accounting Reform and Investor Protection Act of 2002 (Sarbanes-Oxley Act) aims to create auditable business processes, improve financial transparency, and create strong internal operational controls. It requires that companies prepare and maintain documentation of financial reporting processes, create internal controls, evaluate and correct control deficiencies. This legislation has led to long overdue technology and process simplification and standardization. Although no stand-alone IT solution exists for SOX, companies can still achieve Sarbanes-Oxley compliance cost effectively. In fact, SOX should be a catalyst to drive change and enhance value. Whether a company is trying to comply specifically with sections such as 302, 304, 401, 404 or 802, or improve its overall processes and reporting, it will undoubtedly see the benefits of complete visibility, reduced risk, greater control and better spend management.
 Sarbanes Oxley Compliance and Its Impact on Spend Management
To comply with SOX, companies need visibility into their spend management processes, the ability to track performance, as well as full oversight of financial records.
The graphic above shows the processes and activities needed to comply with SOX in the area of spend management.
Although SOX calls for readiness and competencies from all of the major lines of business within a company, compliance ultimately begins with purchasing and spend management.
A Range of Ketera Solutions for Sarbanes Oxley compliance
Ketera is one of the few companies that provide an on demand, cost effective software solution to help companies achieve Sarbanes Oxley compliance in procurement and spend management. Our spend management software solutions not only meet SOX compliance requirements, but also remove financial and legal liability from regulatory non-compliance. And because they are entirely Web-based, our solutions can help achieve ROI within just weeks.
We offer an entire suite of solutions for spend management that will streamline your spend, sourcing, and procurement operations, as well as reduce costs along each of these value chains. Most importantly, each solution comes with built-in SOX compliance.
Contract Compliance and Management for Sarbanes Oxley
One of the key challenges facing companies today is the management and control of contracts. Most fortune 1000 companies have between 20,000 to 40,000 contracts to monitor across various divisions and locations.
As such, the need for Sarbanes-Oxley compliance has led many companies to reevaluate the way they have historically dealt with contracts. For example, individual contracts are often spread across many divisions, or functions, in an organization. Moreover, some contracts exist in electronic form, while others are paper documents. As a result, most businesses lack the visibility and traceability that a central repository would otherwise provide. Furthermore, many companies lack the systems and processes to track and manage the risks to which they are contractually obligated. And often, the sheer number of contracts can overwhelm any company's manual processes.
That's why, to meet SOX requirements, businesses need risk and obligation management built into their contracting process, along with traceability and compliance management. Every business also requires early warning systems and alerts to ensure compliance with respect to pricing, volume obligations, volume discounts, and renewals. Furthermore, SOX requires that companies monitor contracts for performance and financial reporting over time.
Ketera Contract Management allows companies to monitor and track performance across supplier and vendor agreements of all types. The solution creates a central electronic repository of all your contracts, providing full visibility and traceability. Moreover, it can be implemented in just a matter of days. Additionally, Ketera enables the various organizations within your company to track and monitor all its contracts. With rich functionalities such as event- and time-based alerts, our contract management solution automates contract risk and obligation management from start to finish. And unlike competing solutions, only Ketera offers a contract-on-boarding service to new customers. This service includes contract scanning, keyword extraction, document conversion, and clause and template library creation.
» Learn more about contract management solutions from Ketera.
Procurement for Sarbanes Oxley
Sarbanes-Oxley compliance impacts businesses along the entire spend management process. It requires that every transaction be approved, managed and reported. But what happens when you have many suppliers for the same category at one or more different locations? How will you track all your suppliers and their performance to ensure there is no material impact to your financials? What happens when your employees spend off contract? What happens when you cannot account for spend across businesses?
The Ketera Procurement and Spend Analysis solutions address these issues by addressing the entire source-to-pay cycle, thereby providing visibility into individual employee spend. This capability allows for the development of improved processes and approval flows, as well as the ability to analyze, report, and finally, reengineer processes for the future.
Moreover, the Ketera Procurement solution helps you create processes that automatically meet SOX requirements. Our Procurement solution lets your users view and order through an approved list of suppliers. You benefit from pre-negotiated pricing, the ability to create preferred vendor lists and catalogs, and an online approval process that is fast and easy to use. These features lead to better accountability, transparency and traceability across the spend management process, as well as full compliance with the SOX regulations.
Our solutions also help in controlling, monitoring, and measuring supplier performance. Ketera helps you monitor your supplier base for contract performance and service level agreements (SLAs). You can even monitor financial data in order to track your suppliers more pro-actively.
» Learn more about e-Procurement solutions from Ketera.
Spend Analysis for Sarbanes Oxley
"Maverick" spending is a perennial problem in companies across all industries. Faced with the enormous challenges of reigning in this spending, many companies do not address or manage it adequately within their organizations. And that's where Sarbanes-Oxley compliance presents real opportunities for substantial, tangible gains.
If you want to address these issues in your spend management initiatives, Ketera has solutions that will enhance your Sarbanes-Oxley compliance, while also reducing your total costs in company spending. The Ketera Spend Analysis solution identifies all of the maverick spending within the many organizations and locations of a company in order to bring them under contract. This is the first step in streamlining operations and ensuring financial transparency. Bringing maverick spending under contract also creates an auditable business process, which is critical for Sarbanes-Oxley compliance.
» Learn more about spend analysis solutions from Ketera.
Sourcing for Sarbanes Oxley
While not directly related to Sarbanes-Oxley compliance, Ketera's sourcing solutions act as a key connection mechanism between spend analysis, which helps you to discover material supply risks, and contract management, which helps you track and manage that risk. Sourcing reduces your vulnerability to supply chain risk by streamlining supplier negotiations, and by allowing you to manage a greater scope of categories actively. Sourcing also satisfies the basic compliance requirement for pre-approved pricing and suppliers.
Conclusion
SOX mandates that companies comply with a wide range of financial management and reporting requirements. Yet leading companies will view compliance as an important milestone on the way to significant gains in business performance, executive decision support, and more efficient financial processes. Using Ketera's host of spend management solutions, companies cannot only comply with SOX, but also manage their voluminous contracts more effectively, reign in maverick spending across divisions and locations, and optimize their procurement processes. |
