An Ounce of Prevention


Sarbanes-Oxley programs that address both compliance and business objectives can help companies trim the costs of section 404 compliance.

The 404 Institute’s third annual Benchmark Study found that companies with low compliance costs and more effective outcomes reported a:

Higher degree of centralized transaction processing and control.

Higher percentage of automated vs. manual controls, as well as preventive vs. detective controls.

A greater reliance on company-level controls.


The study found that companies that made compliance part of employees’ everyday work benefited from:

The use of fewer full-time resources , with more individuals dedicating less time to compliance.

A broad view of risk , relying more heavily on corporate governance and transactional volume than on factors such as the dollar value of accounts.

Substantive interaction with business owners , by involving compliance teams in the design stage of process changes rather than notifying them after changes have been made.

Strategic use of internal audit , focusing less on direct testing and more on self-assessment, strategic testing and reviewing changes.


Source: The 404 Institute’s “Lessons Learned From Compliance Efforts,” Benchmark Study , 2007, www.404institute.com.

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