Real-Time Vigilance: Continuous Monitoring for a Resilient Organisation

ASD Consulting emphasizes the importance of real-time vigilance and continuous monitoring to build resilient organisations, highlighting their role in internal audits.

Imagine having an early warning system that constantly monitors your organisation's pulse, flagging anything unusual or out of place the very moment it occurs. No more waiting for month-end reports or quarterly audits to discover a problem. In our final blog post, we'll explore how advanced data analytics can transform your control environment from a periodic check-up to continuous, real-time vigilance.

Building on the foundation of unified data (our 'data hub') and strategic Key Performance Indicators (KPIs) that we discussed previously, this is where the true power of data for control really shines. We can move beyond looking at summaries and dive into scrutinising individual transactions and activities across your entire organisation, all day, every day.

Detecting the 'Unusual': Uncovering Risks as They Happen: This isn't about 'catching' people; it's about proactively identifying potential errors, emerging risks, or process breakdowns before they escalate into significant financial losses, reputational damage, or compliance headaches. Think of it as a highly intelligent alarm system for your business.

Here are compelling examples of how data analytics can automatically identify signals that demand attention:

• Transactions that are 'Out of Context':

  • Unusual Supplier or Item: Imagine a purchase order suddenly appearing for a non-standard item from a supplier your company has never used before, or a payment initiated to a new bank account that doesn't match the supplier's usual details.

  • Off-Hours Activity: A large financial transaction processed outside of regular business hours, or an unusual number of system logins during a public holiday. These are red flags that could indicate unauthorised access or potential fraud.

  • Role Mismatch: A transaction being approved by an individual who doesn't typically handle that type of approval, or who is outside their usual department.

    
    

• Unusual Patterns or Deviations from the Norm:

  • Sudden Spikes or Drops: A sudden, unexplained spike in customer returns for a specific product line, even though overall sales are steady. This could signal a quality issue or even a product defect. Similarly, an unexpected drop in inventory levels for a popular item might indicate theft or a data entry error.

  • Consistent Exceptions: An employee consistently processing an unusually high number of manual overrides or exceptions in a system, deviating from standard procedures. While some exceptions are normal, a consistent pattern could indicate a process flaw or a potential control circumvention.

  • Velocity Trends: A rapid increase in the number of new vendors set up by a single individual, or a cluster of similar-value payments being made to different entities within a short timeframe.

    
    

• Unexpected Human Interaction:

  • Access Violations: Multiple users accessing sensitive data or critical systems outside their usual roles or authorised permissions. For example, a sales team member accessing sensitive HR payroll information.

  • Segregation of Duties Breaches: A single individual performing both the creation and approval of a high-value purchase order, or both entering and releasing a payment. While manual controls might exist, data analytics can flag these actual occurrences.

  • Unusual System Activity: A user attempting to access a module or function they have no legitimate business need for, or an unusual number of failed login attempts for an executive account.

From Reactive to Proactive Risk Management: The beauty of continuous monitoring through data analytics is the ability to enable immediate investigation and remediation. When an anomaly is flagged, the relevant team can be instantly notified, allowing them to:

• Investigate Rapidly: With all the contextual data available in your data hub, investigating the flagged transaction becomes far more efficient.

• Remediate Swiftly: If an error or unauthorised activity is confirmed, corrective action can be taken immediately, minimising potential losses or damage.

• Strengthen Controls: Each identified anomaly provides a learning opportunity to refine existing controls or implement new ones, making your processes more robust over time.

This constant vigilance significantly strengthens your control environment, moving you from a reactive stance – where you discover problems long after they've occurred – to a proactive one, where you can intervene at the earliest sign of trouble. It fosters a culture of transparency and accountability by shining a light on potential issues and encouraging adherence to established processes.

Ultimately, the transformative power of data lies in its ability to empower your organisation to anticipate, identify, and address risks in real-time. By embracing continuous monitoring, you're not just building a more efficient operation; you're building a truly resilient and well-controlled organisation, ready to face the challenges of today and tomorrow with confidence.