EXECUTIVE SUMMARY
Created in response to recent corporate scandal, the Sarbanes-Oxley Act of 2002 redefines compliance to include transparency of financial processes as well as honest reporting of the results.
404 of the Act requires an internal control structure and that officers are obliged to report about it in detail in their periodic reports to the SEC.
An influential consortium consisting of the largest professional organizations of accountants (COSO) has developed a framework of internal control that will likely be the de-facto standard for Sarbanes-Oxley compliance.
The sales and marketing function faces a unique challenge in erecting its internal control structure because some of its key finance-oriented outputs (sales forecasts and projections) upon which many other functions rely, are based on abstract or estimated data and are generated through non-standardized processes.
Analytics -- the tools, processes, and expertise of pooling information and drawing meaningful insight " are a critical component of a compliance strategy for the sales & marketing function.
To prepare for compliance (beginning in June, 2004 when 404 goes into effect) heads of sales and marketing functions can do three key things:
1. Develop a strategy for using analytics in compliance;
2. Define the key financial outputs of the function and infuse their production with scientific, analytical insights and processes;
3. Use the COSO framework for internal control to identify priorities for implementing an analytics solution
The challenge of building a sophisticated analytical capability is daunting but the rewards are great. Not only will companies be in a better position for compliance, but the insights gained from an analytics infrastructure will generate innumerable benefits to the business by helping optimize sales and marketing activities. (Continued in Part 2)
Disclaimer
The information and opinions expressed on this paper are not intended to be a comprehensive description, nor to provide legal advice, and should not be treated as a substitute for specific advice concerning individual situations. While the author and Upper Quadrant has made every attempt to ensure that the information contained in this document is accurate, neither the author nor Upper Quadrant is responsible for any errors or omissions, or for the results obtained from the use of this information.
Created in response to recent corporate scandal, the Sarbanes-Oxley Act of 2002 redefines compliance to include transparency of financial processes as well as honest reporting of the results.
404 of the Act requires an internal control structure and that officers are obliged to report about it in detail in their periodic reports to the SEC.
An influential consortium consisting of the largest professional organizations of accountants (COSO) has developed a framework of internal control that will likely be the de-facto standard for Sarbanes-Oxley compliance.
The sales and marketing function faces a unique challenge in erecting its internal control structure because some of its key finance-oriented outputs (sales forecasts and projections) upon which many other functions rely, are based on abstract or estimated data and are generated through non-standardized processes.
Analytics -- the tools, processes, and expertise of pooling information and drawing meaningful insight " are a critical component of a compliance strategy for the sales & marketing function.
To prepare for compliance (beginning in June, 2004 when 404 goes into effect) heads of sales and marketing functions can do three key things:
1. Develop a strategy for using analytics in compliance;
2. Define the key financial outputs of the function and infuse their production with scientific, analytical insights and processes;
3. Use the COSO framework for internal control to identify priorities for implementing an analytics solution
The challenge of building a sophisticated analytical capability is daunting but the rewards are great. Not only will companies be in a better position for compliance, but the insights gained from an analytics infrastructure will generate innumerable benefits to the business by helping optimize sales and marketing activities. (Continued in Part 2)
Disclaimer
The information and opinions expressed on this paper are not intended to be a comprehensive description, nor to provide legal advice, and should not be treated as a substitute for specific advice concerning individual situations. While the author and Upper Quadrant has made every attempt to ensure that the information contained in this document is accurate, neither the author nor Upper Quadrant is responsible for any errors or omissions, or for the results obtained from the use of this information.
About the Author:
This document is written by Dean Gill and is copyrighted by Mr. Gill and his employer, Upper Quadrant. For additional information, or if you would like to contact Mr. Gill directly, you may do so by email at dgill@upperquadrant.com, or call 703-476-1992. Alternatively you can visit Upper Quadrants website or Marketing ROI (ROMI) website.
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