Use JIRA as ICS Software Solution?
Issue tracking systems (ITS) like JIRA from Atlassian got more and more popular in recent years, especially in the agile software development. In this case, one single ‘ticket’ corresponds to a work package in the software project. But there are good reasons to use a issue tracking systems even in management processes and in particular to map internal control processes within an ITS. Below we describe a tangible application from the demands of the internal audit or the compliance department.
The effectiveness of an internal control system (ICS) must be proven in the annual financial statements. In practise – especially in medium-sized companies – a risk control matrix (RCM) is maintained in one or more distributed Excel files. On the basis of a continuous risk assessment and its descriptions, internal controls are defined. Subsequently the controls are assigned to control owners and carried out at fixed intervals. The documentation of the control actions usually takes place again in Excel files or in Sharepoint lists. The evidence for each control execution is then stored somewhere on the company’s file servers. To prove the effectiveness, the controls are then tested at intervals, the result recorded and the RCM is adjusted accordingly. Last but not least, the auditor will look at the documentation once more in the course of the end years audit.
Most employees feel annoyed by the described setup. The first reason is, that Excel is simply the wrong tool for this task: it is not made for the collaboration between different departments, the internal audit, the compliance department, the management and the external auditor. And it is inappropriate to distribute work packages to different persons, track progress, and manage documents. Another aspect is that an ICS is generally regarded as adding no value to the company’s strategy and hinders day-to-day business. And at the end of a financial year, the annual audit in terms of the ICS involves a high level of personnel and cost-intensive work for the company.
By using JIRA enormous savings potential can be raised and the satisfaction of the employees and of the management can be increased enormously. By simple customizing, JIRA can automate an ICS and thus generate real added value for the company. Each employee performs his task intuitively in tailor-made tickets, uploads evidence and holds the status at the touch of a button (eg OK / Not-OK). The completion of ICS tasks is conveniently triggered by email reminders. And through the principle of work packages (tickets), the effectiveness of the ICS can be monitored with reports and dashboards in real time. Such a project can be set up by experienced persons within a few project days (mostly 2-5 working days). And with all of the ICS information in one place, the cost and burden of auditing the ICS in the course of the annual financial statements audits drops dramatically.