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Information management technology can help accounting firms enforce information control and reduce emerging risks in the finance sector.
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How information management technology can help reduce compliance risks
22 June 2023
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11 minute read
The modern workplace is always evolving, especially as businesses continue to embrace new ways of working in the hybrid work environment and leverage learnings from the fourth industrial revolution (4IR) to enhance the fifth industrial revolution (5IR) with new technologies.
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Although digital solutions can optimise organisational processes, they can also expose them to new risks and potential exploitation by external threats, presenting a challenge for many businesses across various industries.
Regardless of sector, two of the biggest risks or challenges facing organisations are security and compliance. In fact, recent data shows that dealing with evolving regulatory processes, including reporting changes and impacts, is one of the top five business challenges for 2023, and is an issue for 35 per cent of Australian business leaders. And it’s anticipated that this will continue to be a significant issue for organisations into the future¹.
Businesses that operate in the finance sector, such as accounting firms, face significant risks and ramifications if they fail to achieve compliance. It’s especially pertinent for organisations across the industry to take steps to remain compliant as compliance exists to protect clients, stakeholders, and the broader economy and society from market manipulation, financial crime, and systemic risk. It’s also essential to help promote transparency and maintain integrity.
Failing to comply with industry and government regulations can lead to hefty fines and reputational damage for accounting firms. Additionally, noncompliance can also expose vulnerabilities in a business’s systems and processes, which can be exploited by malicious threat actors in instances of cyber crime.
As such, it’s essential that organisations take steps to strengthen their compliance measures across operations.
Reducing the risk of noncompliance with digital solutions
To help mitigate the risk of noncompliance, accounting firms are increasingly turning to digital solutions to promote improved information management. Digital information management solutions that leverage new and emerging technologies, like automation, can be helpful for organisations looking to streamline their processes and workflows and better meet compliance needs without sacrificing cost efficiencies or security processes.
There are five primary ways digital information management solutions can help improve compliance and confidentiality for accounting firms:
1. Reduce risk of data leaks
Digital solutions can go a long way towards strengthening compliance by helping to reduce the potential for data leaks through bolstering access and controls. The latest information management solutions let businesses more easily manage permission controls based on role, level, and client assignments.
Providing more control around access lets organisations ensure only authorised people can gain access to sensitive content, which helps to protect information and maintain compliance. Managing permissions also facilitates insight into who accessed data or documents and when.
2. Build trust
Ensuring that only the right people have access to sensitive information helps to build trust with clients, partners, and the general public. This is essential in the finance sector, as businesses like accounting firms handle a significant volume of personal data for clients.
The risk of this information being caught up in a data breach can be catastrophic so it’s essential that organisations do their due diligence and ensure strict compliance measures are in place to guarantee that only authorised personnel can access data.
3. Maintain tight information control
Maintaining tight information control can help businesses protect their brand from negative publicity associated with data leaks by not only reducing the potential for leaks, but also demonstrating that strict controls are in place to prevent them.
Strict data controls enabled by automated digital information management solutions let organisations align their compliance needs with the speed of their business.
4. Reduce manual processes
Digital information management solutions that leverage automation can deliver major benefits to accounting firms. On a fundamental level, automation is critical to reduce the use of manual processes, which can be time consuming and error prone.
In particular, leveraging automation and digital solutions also helps to provide much needed audit trails—identifying who accessed a document, who made changes, and when these occurred—which are essential for compliance, information security, and auditability.
5. Simplify workflows
Facilitating access to only the necessary information also improves productivity across teams. Personnel won’t waste time viewing content that’s not relevant to them, or content they shouldn’t see in the first place. Digital information management solutions that leverage automated workflows effectively guide users to the information they need, letting them focus on core work.
At the same time, these workflows reinforce compliance controls by ensuring team members can’t bypass essential reviews. Streamlining workflows eliminates the need for users to remember details of business processes while simultaneously creating bulletproof compliance controls and audit trails as a side effect.
Investing in information management technology can help reduce compliance risks while simultaneously enforcing improved information control. Accounting firms that leverage outdated, inefficient compliance tools and processes are at greater risk of being noncompliant and opening their organisation up to potential vulnerabilities.
It’s essential that businesses take the time to explore and invest in modern digital information management solutions to eliminate this risk.
By Ville Somppi, vice president, industry solutions, M-Files
Reference:
(1) https://kpmg.com/au/en/home/
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