SEC learns lessons of New York.
Big Five firms meet Securities and Exchange Commission to ensure future disasters don't result in business meltdown due to IT failure
Representatives of the Big Five accountancy firms have met with the Securities and Exchange Commission on an ‘informal basis’ in a bid to thrash out new ways of expanding audit following the terrorist attacks of 11 September.
The early discussions could lead to changes in its rules, which would have wide-ranging implications on British companies who have operations based in the US.
It is understood that the firms and the US regulator are looking into companies’ dependency on their IT systems, back-up systems and system availability, and the ability to function when, or if, companies are placed into ‘dispersed mode’, as many were following the disasters in New York and Washington.
John Rade, president and CEO of New Jersey-based e-business provider AXS-One, said: ‘The meetings (to discuss audit) are already happening on an informal basis – much in the same way as early talks took place between the Big Five and the SEC regarding preparations for potential problems in the lead up to Y2K, talks which eventually developed into much more significant and formalised discussions.’
Speaking at a roundtable debate in London last week, a panel of IT industry leaders added that, while technology – particularly the internet – coped well with the consequences of the disaster, the main problems faced came from poor disaster recovery planning.
They said in the aftermath of the carnage, the internet came of age, proving itself as a robust communications utility, with some banks managing to get standby systems going within hours.
But many firms found they were unable to reach their standby sites because the area was cordoned off or inaccessible, and others found they had too much information held either on paper or on inaccessible desktop PCs.
While the internet provided a means of communication during the tragedy, and some people were able to resume working remotely from their homes, other less technology-savvy people were left stranded.
Call for post September 11 IT rethink www.accountancyage.com/IT/1126553.