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Control Automation to Reduce Costs of Control

Control Automation to Reduce Costs of Control

Rob Christiaanse, Joris Hulstijn
Copyright: © 2013 |Volume: 4 |Issue: 4 |Pages: 21
ISSN: 1947-8186|EISSN: 1947-8194|EISBN13: 9781466635906|DOI: 10.4018/ijismd.2013100102
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MLA

Christiaanse, Rob, and Joris Hulstijn. "Control Automation to Reduce Costs of Control." IJISMD vol.4, no.4 2013: pp.27-47. http://doi.org/10.4018/ijismd.2013100102

APA

Christiaanse, R. & Hulstijn, J. (2013). Control Automation to Reduce Costs of Control. International Journal of Information System Modeling and Design (IJISMD), 4(4), 27-47. http://doi.org/10.4018/ijismd.2013100102

Chicago

Christiaanse, Rob, and Joris Hulstijn. "Control Automation to Reduce Costs of Control," International Journal of Information System Modeling and Design (IJISMD) 4, no.4: 27-47. http://doi.org/10.4018/ijismd.2013100102

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Abstract

Much compliance effort concerns adherence to contracts. Parties to a contract need to make sure that the other parties will deliver. To this end they may require additional controls in the business process to monitor delivery and induce contractual penalties when needed. Controls have costs. In this paper the authors argue that introducing fully automated controls will help to reduce control costs, because (i) they can prevent misstatements (compliance by design) or (ii) they increase the quality of evidence and thereby reduce the audit risk for the external auditor and corresponding audit fees. The line of reasoning is illustrated by a case study of the implementation process of automated controls on the procurement process for public transport services for the elderly and disabled. This is a complex and heavily regulated domain. The case study indicates that control automation makes monitoring compliance to contracts in such complex domains feasible and that using control automation can in fact reduce the costs of control.

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