Sarbanes-Oxley Compliance Teams:
Four Discussions You Need to Have About
Because of the need for Sarbanes-Oxley compliance, companies
may not be able to accept the risk associated with certain manual IT processes.
These processes are being replaced by lower-risk, automated processes that map
to formal control frameworks. This paper describes mainframe compliance trends
that affect compliance professionals.
As a member of your company’s Sarbanes-Oxley (SOX)
Compliance team or audit staff, you’re helping your CEO and CFO prepare for
their Sarbanes-Oxley Section 404 Attestation.
Since SOX requires that the controls used by execs must be in line with
industry standard frameworks, they’re counting on your team to help ensure the
right compliance frameworks and controls are used. They’re trusting that any
attestation-related testing won’t bring down the company’s production systems.
You’re involved in research, analysis, and the facilitation of numerous
discussions between management, IT, and auditing. Here are four such
conversations you should have.
The “Mainframe Database Compliance” Discussion
How many mainframe databases does your company have? The
databases may be attached to legacy applications, SAP, PeopleSoft, or other
systems. Usually there are multiple copies, since IT needs exact copies for
testing, business intelligence, development, data warehouses, or other
Making a copy isn’t hard, but the copy isn’t usable until
it is given a unique name. Then, hundreds or even thousands of database
pointers must be updated. The traditional process for making the copy usable is
manual and can take up to two days.
The process is tedious and boring. Each step is a
potential point of error, and it would be possible for errors to slip through
undetected. There’s no easy way to check all your steps, so IT assures you that
they’re very, very careful when they do this. Even so, they can’t promise you
that what they’ve created are exact copies of the originals.
In the past, the IT department may have been willing to
accept the risk that errors were introduced during the copy process. But
Sarbanes-Oxley has raised the stakes. Since Section 404 means that the company
CEO and CFO must acknowledge risks and attest that controls are in place to
manage them, they’re expecting to provide input into the levels of risk they’re
willing to accept.
also expecting you to provide expertise. They’re looking to you to spell out
their alternatives. Here are the alternatives for mainframe compliance for
the manual processes and hope the company doesn’t fail its Sarbanes-Oxley (SOX)
Section 404 audit because of lack of controls.
extensive, expensive downstream processes and controls to detect data errors.
a mainframe compliance tool to automate the database copy process.
These days, you and your execs
may be considering automation as an important compliance strategy. If the
automation tool saves money for IT, frees IT staff from a tedious, boring task,
or allows them to create new copies more often – those are added benefits.
2. The “It’s Not Enough” Discussion
Is IT ready to:
Control a process
Prove compliant processes were followed?
If they don’t already realize it, it might be up to you to
inform the IT Department that the Wild West Days of IT are over. They need to
understand that in the post-Sarbanes-Oxley world, it’s not enough to just ‘do’
IT tasks – even if they’re successful and everything works as designed. Now,
it’s necessary to Control it, Do it, Document it, and Prove
You may have to explain what adequate controls look like.
You’ll no doubt be involved in setting standards for documenting control and
audit activities. You’ll help your company organize and store records to prove
that compliance steps have been taken.
IT may ask for guidance for non-automated tasks. One
approach may be to document processes and to complete detailed reports or
checklist each time the task is completed. This could produce auditable proof
that risks were acknowledged, controls were in place to manage the risk, and
these controls were actually executed.
Your IT Department might tell you it would take longer to
document the completion of a task than to perform it, creating an undue burden.
You’ll want to ask questions:
the task involve tedious and repetitive non-value-add work?
it a lengthy, manual process with multiple points of error?
an automated alternative exist?
Automated solutions may have been rejected in the past, it
they were evaluated merely on ROI within a small group. You may be asked to
help reframe the value statement to include compliance criteria.
3. The “Segregation of Duties” Discussion
How is IT maintaining
segregation of duties for systems and databases with single-person coverage?
Sarbanes-Oxley guidance issued by the government stresses
the importance of Segregation of Duties. You may be asked to help explain how duties can be divided, or segregated,
among different people to reduce risk of error or inappropriate actions. You may have to describe the flow of
financial processes, clarifying roles and ensuring that no one person has
control over all aspects of any financial transaction.
But what if your company has single-person coverage of key
mainframe databases? Short of hiring extra staff, what can be done to achieve
You may need to recommend the automation of tasks where
possible. That way, when IT has pairs of tasks that fall under Separation of
Duty requirements, at least one of the pair can be handled by someone other
than the mainframe expert.
4. The “Change Management” Discussion
Is the scope of IT Change
Once a system or database has been deemed Sarbanes-Oxley
compliant, it will be up to IT to avoid doing anything to take it out of
compliance. You may need to encourage IT to broaden the scope of its Change
Management efforts. They may be used to focusing on newer systems, using less
formal processes to manage legacy systems and mature databases. You may need to
remind them that all systems and databases are included in compliance
requirements – including mainframe systems and databases.
ComplianceCopy™ – An Automated Alternative for Mainframe Databases
A mature, proven alternative for mainframe compliance
exists. ComplianceCopy™, offered by ESAl, is an out-of-the box solution based
on existing technology currently in place in Fortune 500 companies,
domestically and internationally. IT departments have purchased the technology
based on its ability to ease time demands on stressed IT resources, since it
reduces data availability time from days to minutes. Now it is solving problems
for compliance departments looking for automation and controls.
ComplianceCopy™ is packaged with ComplianceKit materials
designed to assist internal compliance groups with SOX 404 attestation efforts.
These include a mapping of key ComplianceCopy™ control points to the COBIT
framework and the COSO framework, which are the defacto standards for
Sarbanes-Oxley compliance. Also included
are suggestions for integrating the tool into the company’s:
Information Life Cycle Management policies,
standards, and processes
Software Development Life Cycle policies,
standards, and processes
Testing and Quality Assurance policies,
standards, and processes
Software Change Management policies, standards,
Data governance policies, standards, and
ComplianceKit for ComplianceCopy™ also comes with reusable
templates and checklists that can be employed by IT to help document and prove
their ongoing mainframe compliance and database compliance efforts. They can be
used for multiple compliance initiatives: Sarbanes-Oxley, Basel II, HIPPA, U.S.
Patriot Act, and others.
Gwen Thomas is a Principal with Data Governance, Inc.
She’s helped numerous Fortune 500 companies implement governance and compliance
in the areas of structured data, unstructured content, and meta data. She’s
also the editor of SOX-online, the world’s largest vendor-neutral Sarbanes-Oxley
Visit SOX-online at www.sox-online.com or contact Gwen at [email protected]. You
can call her at 321-438-0774.
Enterprise Systems Associates, Inc. (ESAl) is a leading provider of
complete infrastructure solutions for medium to large IT organizations,
providing support at the strategic, tactical and
pragmatic levels. They provide enterprise tools, SOX tools, and professional
Visit the ESAl website at http://www.soxtools.com, or call them at 1-877-SOX-TOOLS or