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Business Process Improvement: Part II. بهبود فرایندها: قسمت دوم. Continuous Audit for Business Process Improvement: Examples from Fidelity Investments. GTS Wire Transfer Audit. Audit Objectives: Develop audit and monitoring tools to detect unauthorized wires.
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Business Process Improvement: Part II بهبود فرایندها: قسمت دوم
Continuous Audit for Business Process Improvement: Examples from Fidelity Investments
GTS Wire Transfer Audit • Audit Objectives: • Develop audit and monitoring tools to detect unauthorized wires. • Provide continuous, efficient, and non-intrusive audits of wire payment activity. • Ensure details of wire payments processed by the bank are consistent with the original wire request. • Establish a base-line for future analysis of wire payment analysis
Manual vs. Continuous Auditing • Present System (Manual Confirmation Validation): • The Cash Administrator uploads & prints the Intraday Statement Report several times a day from Bank One. This report shows the daily activity running through the Bank One concentration account only. This report serves as an interim confirmation that the transmitted wires were received by Bank One. The CA ensures that all wires transmitted are listed on this report manually. • Continuous Auditing (Automated Confirmation and Exception Reporting): • Wires imported by Corporate Treasury is electronically matched with confirmation files received by FW2000 and exception reports are generated.
Wire Transfer Data Transformation • Sample* Wire Transaction Requested by ESS (Employee Shareholder System) and Imported to XRT System by Treasury Cash Administrator (raw data has no column headings, each record is shown in four lines): • 1. "NONREP,5419121,CO,ACH CCD,36833.19,,,01/14/2000,22,,,,,,,,,," • 2. "BENE,,,29019000519053202,John Brown,,,,,,,," • 3. "BANK,,191234035,,,,,,,," • 4. DETAIL,NTE*UMB Bank" Wire Transfer Audit Table Created After Data Transformation Data Transformation Code data a71599a; infile'h:\oaa\projects\gts\test1'truncover dsd dlm=','; input type1 $ foliocod $ co $ paytype $ amount:dollar15.2 un1 un2 valdate : $10. un3 un3 un5 un6 un6 un7 un8 un9 / type2 $ un10 un11 benacct : $30. benname : $30. un12 un13 un14 un15 un16 un17 un18 / type3 $ un19 ABA : 15. un20 un21 un22 un23 un24 un25 un26 / type4 $ BankName : $50.; *format date ddmmyy10.; format amount dollar15.2; run; • * The names and account numbers have been changed to ensure confidentiality.
Advantages of Continuous Auditing • Enables a thorough understanding of transaction processing details. • Unravels system weakness that can not be detected by merely auditing of business environment and processes. • Eliminate barriers preventing auditor to access crucial data by creating audit data marts. • Helps auditors to spend time on analysis of audit tests and investigation of exception reports instead of accessing data. • Creates a non-intrusive and proactive auditing environment. • Significant long-term cost savings achieved for repeated audits of the same business system(s).
Boston Coach Audit What Has Been Accomplished by Data warehousing/Analysis: • Simple point and click technology for Boston Coach fair analysis. • Auditor has instant access to data. • Data is transformed, formatted and labeled. • Automatic generation of exception reports. • Capability to download data to a familiar environment (MSACCESS, EXCEL) for further analysis. • Graphics capability to “see” the data. • Capability to run either predefined and customized audit tests.
Employee Vendor Match • What Has Been Accomplished by Data warehousing/Analysis: • Automated matching of employee and vendor master files. • An improvement over previous methods of matching by normalizing the employee name field using scan function, and identifying employee name contained within vendor name. • A secured web-based GUI for easy accessing of employee/vendor data. • Capability to further analyze the normalized data using Enterprise Guide.
EVALUATING PROCESS EFFICIENCY: Questions to Consider • To what extent is the process mechanized? For all those tasks done manually, what is the reason they could not be mechanized or automated? • Is the process controlled in part by ex post review and disposition of error reports? Analyze errors by type and source - trace back to their origins and determine whythey happen.
EVALUATING PROCESS EFFICIENCY: Questions to Consider • Is the input of information made "idiot-proof" i.e does the system disallow the input of information which would be incomplete or incorrect? • Are certain tasks or pieces of the process repeated? Why?
EVALUATING PROCESS EFFICIENCY: Questions to Consider • When a form or other critical document is in an area or with a particular person, what percentage of the time is it being acted upon and what percentage of time is it "waiting"? • Why is it waiting?
EVALUATING PROCESS EFFICIENCY: Questions to Consider • How many different people have to touch a given document or piece of information while it is in a particular department, work area, or process? • How many times does the same person touch the same document? (How much "pick up and put down" time is there, and why?)
EVALUATING PROCESS EFFICIENCY: Questions to Consider • Is the same information filed in multiple ways or places, and is there a reason? • Is information filed and then never referred to? • Does management have "work standards" on how many items should be processed per unit of time (or other measure)?
EVALUATING PROCESS EFFICIENCY: Questions to Consider • For tasks or processes that are the same or similar, are there consistent measurable differences in throughput volume or cycle time between locations or people? Why?
Six-Sigma Approach to Continuous Improvement • Six-Sigma is a highly rigorous and analytical approach to quality and continuous improvement with an objective to: • Improve profits through defect reduction; • Yield improvement; • Improved customer satisfaction; • Best-in-class performance.
Six-Sigma Success Factors • Acute understanding of customers and the product or service provided; • Emphasis on the science of statistics and measurement; • Meticulous and structured training development; • Strict project-focused methodologies; • Top management support.
Selected Companies with Six-Sigma Approach to BPI • Honeywell (1994) • Motorola (1987); • GE (1995); • Polaroid (1998); • Texas Instruments (1988);
How the Six-Sigma Statistical Concept Works • Six-Sigma means a failure rate of 3.4 parts per million or 99.9997%. • At the six standard deviation from the mean under a normal distribution, 99.9996% of the populations under the curve with not more tha3.4 parts per million defective. • The higher the sigma value, the less likely a process will produce defects as excellence is appraoched.
DMAIC Approach • DMAIC is an approach for realizing Six-Sigma condition. • Define, • Measure, • Analyze, • Improve, • Control.
Define • Project Definition, • Project Charter, • Gathering Voice of the Customer, • Translating Customer Needs into Specific-Requirements.
Measure • Process Mapping (AS-Is Process), • Data Attributes (Continuous vs. Discrete), • Measurement System Analysis, • Gage Repeatability and Reproducibility, • Measuring Process Capability, • Calculating Process Sigma Level, • Visually Displaying Baseline Performance.
Analyze • Visually Displaying Data (Histogram, Run Chart, Pareto Chart, Scatter Diagram), • Value – Added Analysis, • Cause and Effect Analysis, • Determining Opportunity (Defects and Financial) for Improvement, • Project Charter Review and Revision.
Improve • Brainstorming, • Quality Function Deployment, • Failure Modes and Effects Analysis (FMEA), • Piloting Your Solution, • Implementation Planning, • Culture Modification Planning.
Control • Statistical Process Control (SPC) Overview, • Developing a Process Control Plan, • Documenting the Process.
Process Mapping Guidelines:FLOWCHART SYMBOLS Remember: When using flowchart symbols, make sure you are consistent and use a legend.
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