A structural study of internal control for ERP system environments: a perspective from the Sarbanes-Oxley Act

摘要

After the outbreak of numerous accounting-related scandals, the significance of internal control became the focus of the public's attention. In order to recover investors' confidence in the capital market, US President Bush signed into law the Sarbanes-Oxley (SOX) Act in 2002. Using the view that the SOX Act enhances internal control over financial reporting as the basis, we explore elements of internal control in Enterprise Resource Planning (ERP) system environments. We build an internal control framework with 5 dimensions and 19 detailed factors. Then, we use the framework in our survey of Taiwan public companies that implement ERP systems. We find that the five most important internal control factors are as follows. (1) Establishment of Information Technology (IT) organisations and their relations; (2) integration and communication of financial information; (3) development of IT strategic plans; (4) management of information quality; (5) monitoring of operating procedures.