The Role of Governance, Compliance, and Control in Financial Transformation
If you think of the various things that send a CFO’s pulse racing, then governance, compliance, control, and audit will probably rank quite low on that list. Legacy software designers must have formed similar lists because they’ve treated control and governance as afterthoughts, or even irritants, in the financial modules of classic ERP software. Control concepts are not as urgent as transaction processing, as visible as financial reporting, or as sexy as analytics.
To be fair, back in the ’80s, where enterprise software has its design roots, control was not top-of-mind. These were pre-Sarbanes-Oxley, pre-Basel II, pre-COSO/COBIT, and “audit around the computer” days. And, in all honesty, technology innovation had not reached a point where control was even technically feasible. A gigabyte of storage back then cost today’s equivalent of over $200,000 with similar constraints on processing power. Systems maxed out just capturing journal entries and rolling them up to ledger balances. Back in those days, there was little need or capacity to dig deeply into controls. How the world has turned.