Chevron, an iconic American oil and gas company found itself facing challenges not unlike Care West. Transisitioning an organization to Sarbanes Oxley Act is not a onetime event. Chevron’s creative approach in selling SOA compliance controls and testing to management is an example of solid collaboration with several levels of corporate governance.
Chevron’s Internal Audit Department was struggling with compliance issues. This fact was compounded with the absence of management in the process. In general Chevron management did not ‘buy in” to SOA related measures nor take ownership in any of the processes. In short management relied too heavily on the oversight of the Internal Auditing Department for SOA compliance checks.
Chevron Auditors first designed a campaign that entailed convincing both management and the Board of Directors of the benefits of addressing SOA compliance directly. Chevron auditors presented Benchmark analysis and showcased how other companies effectively used management testing and controls. In addition, auditors presented ways in which SOA compliance practices “improved controls and decreased costs” (Redmond, 2008) . Then the Internal Auditing Group designed a transition plan that ultimately moved testing from Auditors to the hands of management. The specifics of this plan included an education component and a communications component. The intentions of these two approaches were to create more independence as well as communicate that “all parties know management endorses” (Redmond, 2008).
Currently at Chevron, with the new management controlled systems in place, the auditors periodically check the quality of management compliance and testing. These are checked during routine audits. “At Chevron, Sarban ...