The recent
Sarbanes-Oxley legislation stemming from the
fraudulent accounting practices employed by the
likes of Enron, WorldCom, HealthSouth and Ahold is
just one more area where the government has
heightened their focus on accurate financial
reporting. Section 404 requires the SEC to adopt
rules requiring a company's management to present an
internal control report containing:
|
(1) |
a statement of
the responsibility of management for
establishing and maintaining an adequate
internal control structure and procedures
for financial reporting, and |
|
(2) |
an assessment,
as of the end of the fiscal year, of the
effectiveness of the company's internal
control structure and procedures for
financial reporting. Section 404 also
requires the company's registered public
accounting firm to attest to and report on,
management's assessment. |
CIO magazine was
quoted as saying that the current state of internal
controls within American businesses is surprisingly
lax. Most companies have not installed the kind of
systems that can track changes to financial data as
it moves around internally. ERP and CRM systems that
collect data in real time feed that data in most
instances to an unlinked spreadsheet. A 2003 survey
from the Hackett group bears out this conclusion,
47% of the companies surveyed utilized standalone
spreadsheets for budgeting and planning. These same
companies on average pulled data from 3 different
ERP systems.
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|
 Although
the Sarbanes-Oxley legislation only applies to
public companies today, you can rest assure that the
trickle down effect will eventually find its way to
future tax return audits of privately held
companies. Companies in the CPG sector need to
incorporate systems with the capability to link the
fluid and rapidly changing trade promotion
investment to their internal financial systems in
real time. A proven closed-loop trade promotion
system is an integral part of this capability.
When exploring the various options in this area
it is critical to do the proper due
diligence towards ensuring that the system
being evaluated is
truly closed-loop TPM, has a
proven track record of over 5 years
accurately linking this financial data in real time
to all of the appropriate financial systems in at
least
5 reference-able CPG clients.
Our many client references will confirm that
Synectics Group's Account Review™
closed-loop TPM solution meets these
criteria with over
years of CPG trade
promotion management and years of accurate financial
linkage capability to all appropriate internal
client systems. |
