10 Tips For Meeting Compliance Audits

10 Tips For Meeting Compliance Audits

10 Tips For Meeting Compliance Audits

Since you have already covered some basics on compliance, here are ten tips for preparing for and mastering the inevitable compliance audits.

Knowing the process of inspection beforehand. Compliance audit processes and requirements should never be shrouded in mystery. You can often get the inspection checklist or examination manual from the governing or regulatory body directly. Industry associations as well as other groups also provide guidelines for audit, sample procedures and policies, as well as comprehensive workshops on audit preparation. All these can subsequently be used in preparing your own internal audit program. For instance, the MIS Training Institute (MISTI), situated in Framingham, Massachusetts offers a wide variety of internal audit workshops and seminars.
Self-auditing is critical to success. It is critical to have a solid program for internal audit that comprises sufficient documentations as well as follow-up process. Organizations need to perform regular internal data compliance audits while correcting any deficiencies proactively. This is not only for specific industries such as medical product manufacturing or even banking. Public companies bound by the Health Insurance Portability and Accountability Act (HIPAA) or the Sarbanes-Oxley Act (SOX) also need to undertake internal audits. Keep in mind that external auditors typically examine the internal audit system closely. An inadequate or absent internal audit program will manifest as deficient, possibly encouraging deeper examination.

Think Of Using An Independent Auditor.

While conducting your own internal compliance audits is definitely possible, some organizations simply lack the in-house expertise or resources to handle that particular business function suggests data compliance expert River Cohen. To help bridge this gap, companies can use independent third-party compliance audit firms that allow them to present independent results to regulators.

Being aware of any changes in your industry.

One of the greatest threats to data compliance is complacency given that compliance isn’t static. It is a “moving target” that keeps shifting and changing depending on the notable activities in the industry as well as new enforcement priorities within regulatory bodies. For instance, according to the Basel II accord for global banking, internal reporting and analysis of “operational risk” is required to ensure that banks moving to Basel II have to update their compliance audit processes and policies for accommodating this new requirement. Auditors will most likely customize their inspection to allow for the accommodation of any new regulations.

Being aware of problems within your business environment or industry.

Some problems are systemic and a nuisance at one or several companies within your industry can bring compliance auditors straight to your door even when you are not guilty of doing anything yourself. An important example is the recent crackdown by the SEC on the backdating of stock options. Backdating incidents have resulted in litigation as well as penalties for those convicted.

Demonstrating that you are capable of securing compliance data.

Many regulations require that sensitive data be secured to prevent unauthorized access as well as safeguard the data against either alteration or deletion within the proper retention period. This involves technologies including content-addressed storage (CAS) and encryption products. While undertaking the data compliance audit, inspectors will demand that the verification of either of the security requirements are present and work properly. The IT security staff will definitely be aware of the available safeguards and controls but the internal audit processes should be capable of addressing both concerns. You also need to have clearly defined data retention or deletion policies for recovery or backup as well as archiving. Be prepared to show how the elimination of any “expired” data from your storage systems actually happens.

Be ready to produce the documentation quickly.

Previously, organizations would have days if not weeks to produce the documentation that a compliance auditor requests. Presently, regulators expect organizations to produce documents fast, and you should make this an important focus of the internal audit process. A typical examiner might expect the organization’s internal compliance officer to access documentation on demand while the auditor waits in the room.

Paying close attention to legacy IT systems.

Compliance is definitely not a IT-only function but it is critical that IT managers ensure that all the organization’s networking and storage infrastructure continually meets the security requirements, documentation, as well as other regulatory requirements that present themselves. This is especially challenging for older legacy systems that may be unable to keep up with the dynamic compliance requirements. Forklift replacements and upgrades may be necessary for maintaining proper adherence, therefore, compliance managers need to involve IT managers in the data compliance audit process actively.

Never discount the significance of disaster preparation.

Compliance issues involve disaster preparedness and planning, so ensure that you document the systems critical to your mission and prepare a recovery plan for the systems. Compliance auditors may demand that you provide disaster recovery plans for total site disasters and single component faults.

Bringing to the forefront known flaws.

Finally, in case the internal audit exposes an infrastructure lapse, it does not necessarily mean failure of the data compliance audit or even severe regulator penalties. This is particularly true for young companies that are relatively new to compliance issues. The important thing is to present any identified issues to the auditor as well as a reasonable plan for addressing and correcting the lapse. Penalties for hiding a known issue intentionally can be much worse than discussing the lapse then coming up with a plan for fixing it.

Cormac Reynolds

Cormac Reynolds is the owner of UK marketing and SEO company My Online Marketer and has written for a number of prominent publications online. Get in touch @brightoncormac


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