Feb 06 2006 Martin Coyle
More than 70 per cent of compliance officers still rely on spreadsheets for compliance monitoring, despite the risks associated with their use, according to researchers. A survey of 109 City compliance managers discovered that 71 per cent were still reliant on spreadsheets for compliance monitoring, while 67 per cent relied on them for reporting. Optial and the Chartered Management Institute, which conducted the survey, expressed alarm at the reliance on spreadsheets given their apparent lack of security and "auditability".
Only 42 per cent of respondents expressed confidence in their system's ability to meet future changes. No one rated their current system's effectiveness as "high".
"This should act as a wake-up call to the City, given the FSA's approach of prosecuting firms that cannot demonstrate adequate controls," said Anthony Epstein, chairman of CMI's operational risk forum.
Chris O'Brien, Optial chief executive, said the survey highlighted the fact that most firms believed they needed an overall risk model to ensure they caught any risks that individual systems might miss.
Judith Graham, Optial product director, noted that 88 per cent of respondents believed that an integrated system would help to manage risks across geographic units.
"They want the ability to adapt a central control system to each country's specific requirements, so they can consolidate control data directly from the individuals who perform each process," she said.
The views and the opinions expressed in 'hot topics' are that of the individual authors and not necessarily those of the Securities & Investment Institute.
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