While the effects of the COVID-19 pandemic are far from over, the deployment of vaccines and improved treatments gives us hope that we are finally emerging from the pandemic. As a result, many businesses have begun to return to a traditional, pre-pandemic office setting. During this transition, it will be crucial for business leaders and management teams to establish and maintain systems that promote a strong and effective internal control environment.
Here are three points to consider during this period:
While many of us are still working from a remote location and using digital methods for document processing and approvals, it is more crucial than ever to continue to use all the security procedures available in order to maintain preventative and oversight controls over key transaction cycles. These include features as simple as minimum password compliance, or those with increasing complexities requiring employees in charge of IT to monitor system activity and potential outside interference. This also allows for additional security over devices utilized in the field for job cost updates and timesheet input for payroll. Many of these features could be unfamiliar to your employees, which means additional trainings may be necessary to ensure a team-wide understanding on the importance of reinforcing your control environment.
As people transition back to the office, be sure to revert to your original controls that were in place pre-COVID. That said, there can always be room for improvement, so consider adopting any of the enhanced approaches that were developed during the pandemic and modify any internal guidelines to meet your needs during the transition period.
Reflect upon your transition period for improvements. The continuation of employees working remotely could create a possible “out of sight, out of mind” situation, and raise the risk of bypassing internal control policies. During this period, it is important for management to not only review the current policies, but also continue to monitor day-to-day practices to improve the control environment. For the employees involved in performing daily tasks, such as bank reconciliations, job cost approvals, payroll processing, cash receipts and cash disbursements, adhering to the stipulated policies will reduce the risk of errors or fraud in transaction processing.
Business owners have a multitude of items on their mind in a normal world, much less one in recovery, post-COVID. Maintaining controls that fit the current environment’s needs can help keep the integral functions of the business running well during these evolving times. As we emerge from this crisis, business owners will be in an ideal position to take advantage of the new opportunities that are waiting just around the corner.