IT departments get compliance 'mushroom treatment'

IT departments are still being kept out of the loop on compliance issues even though they may hold the answers to many of the most pressing issues.

A staggering 96 per cent of compliance officers within UK financial services organisations believe technology will help them meet the FSA's Treating Customers Fairly initiative and yet only four per cent have an IT implementation plan in place to help them achieve this.

None of the compliance officers interviewed by customer service solution provider Touchpaper had made compliance an IT responsibility.

A spokeswoman for Touchpaper said their discussions with compliance officers show a clear appreciation of the benefits of IT in easing the compliance headache – which makes the lack of IT department involvement all the more surprising.

She said there is still a "disconnect" between compliance and IT.

And without the use of effective IT the compliance headache looks set to get worse.

Amendments to the Companies Act 2004 come into force tomorrow which will give auditors greater powers to request accounting information from UK companies.

Company directors will also be required to state that they have not withheld any relevant information from the auditors - and such claims will have to have a high degree of demonstrability.

Such demands increase the need for effective auditing of all communications and accounts data and the ability to search and retrieve vital business data.

Mark Strauch, COO of IT alignment specialist Business Engine, said such measures should go a long way to preventing an Enron-style scandal this side of the Atlantic.

However, he added: "To achieve this, companies may need to implement new procedures and technology systems that provide directors with real-time visibility into the development of financial figures."

In related news, the Securities & Investment Institute (SII) today announced the appointment of Christopher Bond as Adviser on Compliance.

Bond worked as a solicitor with City law firm Field Fisher Waterhouse for the past 27 years, specialising in financial services regulation.