ACL summer release: Visualizing fraud and financial compliance

By John L. Guerra

Editor, GRC & Fraud Software Journal

aclGRC and Analytics solutions provider ACL introduced its summer release in July, which focuses on features for financial compliance.

The updates span three categories of improvements: scaling up for complex financial environments, 27 new financial crime-related risk analytics, and a new graphic visualization feature that lets investigators visualize analytics pointing to fraud. The new screen has risk visualization capabilities designed for immediate impact in finance teams.

GRC & Fraud Software Journal interviewed Dan Zitting, ACL’s chief product officer, to find out about the new release’s unique focus on visualization and fraud analytics.

GRC & Fraud Software Journal: What led to the focus in financial fraud?

zittingDan Zitting: While financial fraud is not a new priority for corporate compliance officers and finance teams in most large companies, a recent increase in enforcement activity by the SEC involving financial reporting cases has created an urgency for companies to ensure they are both preventing and detecting fraud through more comprehensive systems.

Also, the SEC has stated in no uncertain terms that individuals, including accountants, auditors, audit committees and even C-suite executives, will be held accountable for cases of accounting irregularities that could have been prevented with more oversight or better controls. With financial fraud as the most common type of fraud in large organizations, ACL is ensuring these individuals are confident in the systems in place.

Q: Why are finance teams frustrated with trying to implement streamlined controls for fraud waste, and abuse?

A: In many cases, the problem is the ubiquity of “Big Data.” Finance teams are often overwhelmed by the amount of data collected and the increasingly disparate systems that require extensive analysis and oversight (such as HR, IT, or multiple regional ERP systems).

Also, given the enormity of available data, no ERP system contains comprehensive controls to effectively mitigate risk. This requires finance teams to manually compare data coming from third parties or different systems within the enterprise. When these systems don’t integrate well, they can actually create opportunities for fraud.

Q: What was lacking in streamlined controls?

A: In general, the controls work to identify red flags, but finance teams have historically struggled with understanding the underlying trigger for the red flags as well as how to manage or track the resolution of the issue and the follow up. A streamlined controls system should include a way to visualize the problem (graphically or otherwise), identify who in the organization is investigating the issue and track their progress.

Q:  How does ACL specifically address this frustration?

A: To address these issues, ACL expanded its tools for visualization and project management, adding cross-tab visualization, one-click data distributions and more.

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Go here to see how the visualization tool displays risk.

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