Approva Compliance Survey Finds Majority of Public Company Executives Believe Sarbanes-Oxley Act Has Had a Positive Impact
Respondents also report increased automation, reduced compliance spending
July 12, 2007 - Reston, VA
Approva® Corporation, the leader in continuous controls monitoring and audit automation software, today announced the results of a survey of more than 245 high-level finance, internal audit and IT executives at leading public companies. According to the results of the survey (http://www.approva.net/survey), a majority of respondents, 63%, believe that the Sarbanes-Oxley Act has been successful in preventing corporate fraud. An even greater majority, 83%, believe the Sarbanes-Oxley Act has had an overall positive impact on their companies. A smaller majority, 70%, believe that investments in SOX compliance will provide benefits beyond compliance alone.
Despite industry projections regarding increasing compliance spending, survey results show that a majority (83%) of respondents plan to spend the same amount or less on compliance this year than last. Respondents also reported increases in automated compliance solutions, with 47% reporting use of a software solution to automate SOX compliance efforts. Although a majority of companies are still using manual solutions, the number of companies using automation has grown by 19% since a similar survey conducted by Approva in October of 2006.
The survey also explored respondents’ awareness of and thoughts regarding recent new guidance from the SEC and PCAOB, as well as the perceived effect of Sarbanes-Oxley on corporate fraud and investor confidence.
“Five years after Sarbanes-Oxley became law, companies are able to look back and truly see what SOX has meant to their operations,” said Rick Cobb, chief operating officer for Approva. “Automated controls are starting to bring costs down, as well as reduce human error, and companies across the board have really begun to realize the benefits that a comprehensive compliance program can offer to employees and to operations as a whole.”
Approva Survey Key Findings
-- 63% of respondents believe that SOX has been successful in preventing corporate fraud – an increase of more than 15% since a similar Approva study was conducted in October of 2006.
-- 52% of respondents said that their company would be spending less on compliance costs this year than last. 31% said they planned to spend the same on compliance as last year, and only 17% predicted an increase in spending.
-- 51% respondents believed that SOX has increased the confidence of their investors, while 49% said SOX had not increased investor confidence.
-- 83% of respondents reported following industry news related to SOX and recent new guidance from the SEC and PCAOB.
-- 67% of respondents believe that new SEC and PCAOB guidance will help lessen SOX compliance burdens.
-- 53% of companies are not using a software solution to automate SOX compliance. Of the 47% who are using software solutions, 34% report that between 30-50% of their controls remain manual versus automated. 55% of companies using software solutions report that 50% or more of their controls are automated.
Available Experts
The following experts can discuss Approva’s Compliance Survey, as well as provide expert commentary on the corporate environment at the act’s formation in 2002, the past five years of Sarbanes-Oxley, and predictions for the future.
- Harvey Pitt, CEO of Kalorama Partners, former SEC chairman and independent board member of Approva
As SEC chairman from 2001 to 2003, Pitt led the commission’s response to the market disruptions resulting from the terrorist attacks of 9/11 and led the commission’s adoption of dozens of rules in response to the corporate and accounting crises generated by the excesses of the 1990s. Pitt has an excellent perspective on what the environment was like that led to the creation and passage of the Sarbanes-Oxley Act and how things have changed over the last five years. - Phil Livingston, Vice Chairman of Approva
In his previous role as CEO of FEI, Livingston helped to create and pass the Sarbanes-Oxley Act of 2002. Livingston can offer a perspective about the original intent around Sarbanes-Oxley as well as share first-hand experiences of how companies that have embraced SOX have been able to weave compliance into the day-to-day processes by automating controls testing and monitoring. - Prashanth “PV” Boccasam, CEO of Approva
PV has an unrivaled appreciation for spotting the convergence of business and IT trends and conceiving how new technologies can be applied to address problems that are top priorities for C-Level executives, and can discuss the pre-SOX business landscape, as well as the day-to-day challenges that SOX has posed to both large and small companies.
A summary of the results as well as a PowerPoint presentation can be found on Audit Trail, the official blog of Approva Corporation at www.approva.net/audittrail.
About Approva
Approva® Corporation is the industry-leading provider of governance, risk and compliance (GRC) software and is the continuous controls monitoring standard for half of the Big-4 audit firms. We enable business, finance, IT and audit professionals to automate and strengthen business and IT controls across SAP, Oracle, JD Edwards, PeopleSoft and other legacy applications. Global companies such as Bayer, DirecTV, Discovery Communications, First Advantage, Honeywell, P&G, Pratt & Whitney, Siemens and T-Mobile rely on Approva to reduce compliance risk, increase operational efficiency and flag exceptions to their business controls. Approva has certified integrations with Microsoft, Sun Microsystems, IBM and SAP to provide a holistic GRC solution. For more information, visit http://www.approva.net.