Earlier in the year, we released an insight explaining the importance of establishing a strong control environment. This would reduce risk, protect - and potentially add to - the value of a business.
One of the key messages we highlighted was that businesses and the environments in which they operate are dynamic and constantly changing. It is essential to review regularly whether the established control processes are functioning and remain effective in achieving the objectives they were designed to perform.
In light of the current COVID-19 pandemic, where workers have been encouraged to work from home wherever possible, there may be an additional need to consider whether those control processes are still effective or whether changes are required to maintain a strong control environment.
Some of the key risks faced by businesses in the current circumstances include:
- Increased risk of control override and fraud exposure;
- Physical controls may become redundant and need to be replaced with alternative processes;
- Electronic controls may breakdown as demand on IT systems from remote working increases;
- Phishing scams and other attacks may increase as some people see the virus as an opportunity to capitalise on vulnerability;
- Staff shortages and changes to ways of working might mean that controls are overridden and not operated in a timely manner
Our Consulting and Accounting Solutions Team (CAST) provides accounting advisory support and is on hand to guide you through this challenging period, helping you to understand the impact on your control environment. If your control processes are stretched or could benefit from an independent review in the current circumstances, we would be happy to help.
By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. This briefing does not constitute advice nor a recommendation relating to the acquisition or disposal of investments. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing.
This article was previously published on Smith & Williamson prior to the launch of Evelyn Partners.