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Compliance
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Datasheets
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Download more information
about Nakisa solutions
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Nakisa Contact Information
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Nakisa Inc.
1100 Sherbrooke West, #100
Montreal, Quebec
H3A 1G7
Canada
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U.S. Sarbanes-Oxley Act of 2002
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The large corporate collapses and financial scandals of the 1990s resulted in the drafting and passage
of the U.S. Sarbanes-Oxley Act (SOX). The law was passed to reform the accounting practices,
financial disclosures and corporate governance of public companies.
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SOX & the HR Organization
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Implications of SOX on Human Resource (HR) organizations relate mainly to Section 404 of the law
which mandates an annual assessment of internal controls over financial disclosures and to obtain
attestation from external auditors. Related HR processes include:
- Payroll & Benefits: These HR-owned processes have an impact on financial reporting, and
could expose companies to significant financial risks if they are not managed properly.
- Other HR processes: Performance management, succession planning and recruiting are
also important in the context of SOX because they can impact the mindset of employees
and the ability of the business to institutionalize a culture based on process controls.
Compliance requires companies to strengthen and document their internal controls and corporate IT
systems to support the affected business processes. HR adherence to structured, documented access
management and security practices, and the delivery of accurate human capital data, are key to
compliance:
1. Consolidation of accurate HR data
A major concern for HR relative to SOX compliance is the ability to generate consistent and
accurate data that can be used in generation of financial reports. HR can leverage data
visualization and organization charting applications to consolidate data from multiple
repositories as well as to get the deep visibility into global enterprise information needed to:
- Obtain a complete and accurate view of the organization.
- Have a comprehensive, unified view into corporate & human capital information.
- View and deal with any inconsistencies found to support accurate reporting.
2. Deep views support security requirements
SOX mandates that corporations be able to demonstrate effective controls over security access
to systems and data. HR can also leverage organization charts to locate and validate that
particular positions or individuals within the organization have specific access rights. HR and
department Managers can visually assess the accuracy of granted rights and can take
immediate corrective action when necessary.
3. Data visualization supports data integrity
Automated workflows and self-service mechanisms also provide additional safeguards for enterprise.
When HR or Managers uncover inaccuracies in employee data they can initiate updates via an
organization chart or directory interface that will automatically enforce approval processes, thereby
reducing errors and ensuring changes to employee data meet with enterprise policy.
4. Validation of employee performance & pay
The employee Payroll is the biggest single expense for publicly-traded companies and holes or
mistakes in payroll can have a negative impact on the company's financial reports. With a 360-
degree view into real-time employee and enterprise information HR can help the organization:
- Identify inaccuracies in employee files and payroll information. Payroll data needs to be
in line with the organization and position structure to avoid potential fraud.
- Identify individuals who no longer work for the organization to ensure they are no longer
being paid.
- Validate staffing requirements for the organization & those required to sustain SOXcompliant
practices.
5. Reporting on segregation of duties
SOX requires enterprise to be able to clearly delineate segregation of duties at all times. The ability
to report on the roles and responsibilities for specific tasks and business processes that relate to
financial reporting is required for enterprise to demonstrate compliance with the law.
Real-time data visualization and organization charting can provide HR with the tools it needs to
address the constant evolution of the corporate structure and to provide the up-to-minute information
they require to:
- Identify relationships between managers and their subordinates across all divisions and
levels of the organization.
- Clearly validate and report on the segregation of duties (online & in printed form).
- Search and retrieve positions or individuals responsible for SOX compliant tasks.
- Identify outsourced resources and related chain of command.
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Nakisa & SOX
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Nakisa supports SOX-related initiatives by facilitating the visualization of enterprise and employee
information while providing the tools required to secure the access to, and the update of, human capital
information. Nakisa offers a number of software applications that can be deployed to aid in internal control
of HR processes and SOX compliance:
- Nakisa OrgChart: Display, visualize and navigate organizational structure.
- Nakisa SuccessionPlanning: Identify and manage successors for key positions.
- Nakisa Directory: Access and search employee directory and organization information.
- Nakisa SelfService: Securely update enterprise and employee information online.
- Nakisa WorkFlow: Automate HR data change requests using an approval engine.
- Nakisa FloorPlan: View, manage and track of physical resources.
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