CFOs must guarantee data produced by IT systems
(14 September 2004 – Australia) The working relationship between corporate CFOs and CIOs needs to be closer than ever now that ASX guidelines on corporate governance stipulate that CFOs must guarantee the integrity of their financial data, according to speakers at a seminar hosted by BMC Software.
Mallesons Stephen Jacques partner Patrick Gunning said the recent reporting season was the first time locally listed companies were required to discuss their compliance with ASX recommendations.
He said CEOs and CFOs had to certify to the Board that the company’s risk management and internal compliance systems were operating efficiently and that financial statements represented a true and fair view of the company’s position.
Gunning said the Australian Prudential Regulatory Authority (APRA) had flagged introducing regulations in response to new Basel 2 guidelines on capital adequacy for financial institutions, possibly by the start of 2006.
BMC Software vice president Chip Nemesi said the integrity of a company’s financial data as well as its general risk profile had become intimately entwined with the quality of its information systems.
As a result, he said CEOs and CFOs now asked different questions of their IT departments.
"They ask tough questions, and they don’t ask IT questions. They don’t ask questions like ‘How are your servers running?’ ‘How are your databases running?’" Nemesi said.
"They ask questions like ‘How are the branch banking systems running?’ ‘How is the online trading system running?’ ‘Do we have all the controls in place to make sure there is never a problem?’ Or if there is a problem, they ask ‘What are you going to do to make sure that never happens again?’"
He said CEOs and CFOs had to certify to the Board that the company’s risk management and internal compliance systems were operating efficiently and that financial statements represented a true and fair view of the company’s position.
Gunning said the Australian Prudential Regulatory Authority (APRA) had flagged introducing regulations in response to new Basel 2 guidelines on capital adequacy for financial institutions, possibly by the start of 2006.
BMC Software vice president Chip Nemesi said the integrity of a company’s financial data as well as its general risk profile had become intimately entwined with the quality of its information systems.
As a result, he said CEOs and CFOs now asked different questions of their IT departments.
"They ask tough questions, and they don’t ask IT questions. They don’t ask questions like ‘How are your servers running?’ ‘How are your databases running?’" Nemesi said.
"They ask questions like ‘How are the branch banking systems running?’ ‘How is the online trading system running?’ ‘Do we have all the controls in place to make sure there is never a problem?’ Or if there is a problem, they ask ‘What are you going to do to make sure that never happens again?’"
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