Editor’s note: Bob Broda is managing partner of-Visage Solutions, LLC.Sarbanes Oxley and subsequent SEC and Stock Exchange rulings have dramatically increased the workload and liability of corporate directors, audit committee members and executive management of public and some private companies. All these rules and regulations are usually collectively referred to as Sarbanes Oxley (SarbOx) requirements.

If you have a software vendor trying to sell you a solution in a box, send them away. If you believe you have already purchased one, I’m sorry.

The truth of the matter is that not one tool is available to solve all your problems. The facts are that software will never solve all your SarbOx problems, the most software can do is facilitate the gathering and reporting of data in a timely manner.

If you consider that most of the extensive rules were only passed a few months ago; most software vendors would not have had much time to react to the new legislation. If some vendor were lucky enough to have had previously existing software that required no modifications, take them to Vegas, because they are truly lucky.

There are some tools already available that can be of great assistance. However, your company should be spending most of its efforts on ensuring legal compliance and that the information you put in your systems is accurate. Once you have that well in hand, software tools are available to help reduce the workload it takes to comply with SarbOx

Reverse Engineering Tools: In today’s corporations, varying degrees of important control information exists in software applications. Most large corporations have custom code that is probably poorly documented. Reverse Engineering software can be used to examine and document the business logic and processes buried in software systems. These tools can be very helpful in cataloging and documenting your business processes, understanding logic flows along with modifying and testing the controls by the audit team.

Executive Dashboard or Reporting Tools: Once the control information is documented and risks are determined, the information must be easily accessible to senior management in a timely manner. Some accounting packages have tools that allow access and reporting of information in a consolidated format on a daily basis. However, management must deal with considerably more information than it did in the past. The information will have to be presented in a manner allowing management to deal with it on an exception basis. Besides having the information available for disclosure rules, the additional information can be used to help manage the company more effectively.

Knowledge Management Tools: The policies and procedures of a company must be documented, available and accessible by your staff. The auditing team must also verify that your procedures are being followed. Depending on your company’s size and number of locations, printing, distributing and maintaining copies of policy and procedure manuals can be a daunting task. You may want to consider a tool that makes information available to your staff electronically (with print capability) and allows the information to be updated in a timely and efficient manner.

Risk Management Tools: Although risk management software tools are not necessary to comply with the letter of SarbOx, the intent of the SarbOx is to reduce the risk for the shareholders. If your company is not managing risk effectively, the intent of SarbOx is not being met and the shareholders, board members and senior management could be facing serious personal financial risk. Insurance companies that write Directors and Officers (D&O) insurance are expected to become increasingly demanding in this area. A company that is able to convince the insurance companies that they are managing risk effectively will be rewarded with savings on premiums (over those who can not). These premiums are expected to rise substantially over the next several years and the savings can be substantial.

Communication Tools: Companies need to be able to implement solutions that allow effective communication between employees, management and outside agencies. This could be to allow reporting of suspected fraud (whistle blower), updating employees on changes of procedures or conducting surveys to collect information to feed into some of the other reporting systems.

Some companies may even have to entirely replace their financial accounting system. This may be the exception rather then the rule, however there are a number of companies whose systems are inflexible and do not support the timely reporting and accuracy of the financial information that SarbOx demands. These systems must allow your accountants to close the books in a timely, efficient manner.

As you can see, there are a number of different solutions you should consider when trying to comply with Sarbanes Oxley. You should evaluate your needs, prioritize, but most of all do your best to ensure the data is accurate. If the data is not accurate, your problems will only be beginning and the consequences could be severe!

Remember that implementing software solutions that touch the entire enterprise is not an easy and painless task. Considering that most requirements are not completely understood, your software solution may be creating additional problems before they can solve any.

Visage Solutions are results-focused operation assessment and risk management consultants who offer extensive real-world executive management experience. Visage Solutions offers a suite of services that provide a strategic approach to operations to improve business processes that affect the bottom line. He can be reached at: 919-271-3714 or rmbroda@hotmail.com.