Ask FERF about ... using enterprise content management for Section 404 compliance.

• Author: Sinnett, William M.
• Position: Financial Executives Research Foundation

Sarbanes-Oxley Section 404 has put renewed emphasis on good internal control over financial reporting. Yet, in year one of compliance, many companies still relied on simple spreadsheets to document process controls for their Section 404 efforts.

Those same companies are now looking for business process improvements, standardized systems and automated controls to work more efficiently. (See the article "Year-Two Section 404 Compliance: Smart Companies are Working Smarter," Financial Executive, November 2005.) Many companies have found that Enterprise Content Management (ECM) can be a useful solution for Section 404 compliance.

In fact, many think that ECM--around for years and primarily used by financial services companies--will become the future for document management.

The international authority on ECM is the Association for Information and Image Management (AIIM). ECM is defined by AIIM as: "The tools and technologies used to capture, manage, store, preserve and deliver content and documents related to organizational processes. ECM enables four key business drivers: continuity, collaboration, compliance and costs."

Seven 'Keys' for IM Frameworks

In March 2004, AIIM published Information Nation: Seven Keys to Information Management Compliance, by Randolph A. Kahn, Esq., and Barclay T. Blair. This book makes the case that organizations need to adopt a framework for information management compliance that includes the following seven "keys:"

1. Good policies and procedures;

2. Executive-level program responsibility;

3. Proper delegation of program roles and components;

4. Program dissemination, communication and training;

5. Auditing and monitoring to measure program compliance;

6. Effective and consistent program enforcement; and

7. Continuous program improvement.

In April 2004, AIIM and Kahn Consulting Inc. commissioned a survey of end-user organizations to quantify the current status of adoption of these seven keys. The results of this survey were published in The Emperor's New Clothes: The Current State of Information Management Compliance, by John F. Mancini, president of AIIM. This report, available as a free download from the AIIM website (www.aiim.org), concludes that the reality of compliance is far more complex than most organizations will admit.

In the report, Mancini asserts that "90 percent of the information that organizations must manage is unstructured--information that does not neatly fall into the rows and columns of a...