Month: March 2005

The first year of complying with section 404 of the Sarbanes-Oxley Act has come at a steep cost for many businesses, with greater-than-anticipated personnel, consulting, auditing, and software expenses, according to a survey by Financial Executives International, a professional association of CFOs, treasurers, and financial controllers.

The good news is that the cost of compliance efforts is expected to decrease this year as IT projects undertaken to meeting the financial-reporting requirements of section 404 progress.

Companies like Eastman Kodak, SunTrust Banks, and Toys R Us have reported accounting problems that may preclude their issuing such a statement in their 2004 annual reports.

Uncertainty over auditing procedures for section 404–final guidelines weren’t adopted by the Securities and Exchange Commission until late last year–was cited as a major reason for the variance between estimated and actual costs.

Ninety-four percent of the March survey respondents say the costs of Sarbanes-Oxley compliance exceeded the benefits.

Personnel and external costs are expected to decline by 39% on average through adoption of more-efficient compliance processes and procedures.

http://www.informationweek.com/story/showArticle.jhtml;jsessionid=20JC5RPZDVSV4QSNDBGCKHSCJUMEKJVN?articleID=159904261

While tighter financial controls are forcing IT departments to keep a lid on network costs, cost-saving measures elsewhere may be putting more strain on the WAN, warned Peribit, the network optimisation company that commissioned the Global Application Performance survey.

“IT initiatives like consolidation have a knock-on effect on the network,” said Steven Wastie, Peribit marketing director. “If you reduce your number of mail servers from ten to four, or serve users from a central data centre, you put users further away from the content and that means more traffic on the network.”

While some users will meet this demand by buying new bandwidth, some 34 percent of network managers surveyed by Peribit don’t expect to increase their WAN investment at all in 2005.

Overall, the amount spent on new bandwidth will be 7 percent lower this year than 2004.

Of those surveyed, 71 percent agreed that they will be under pressure to improve applications performance and reduce IT costs.

All this is grist to Peribit’s mill — the company sells optimisation systems, which make the best use of bandwidth and help applications cope with latency. “Application performance is high up the agenda,” said Wastie, “and people understand that it is a latency issue, not just a bandwidth issue.” “Offshoring is a great example,” he said. “A company may put a call centre in the Philippines, but it has to access a customer database in the UK. If it takes three more seconds to answer a query, because of network latency, that may result in fewer calls taken during the day.”

“Disaster recovery is another example,” he said. “Financial institutions have to back up incredible amounts of data, from their primary centre to a secondary site, but there are only 24 hours in a day.” Ensure you continue to make the right strategic buying decisions for your company by keeping up to date on the latest hardware and software developments with our IT Infrastructure newsletter – spanning news, features and reviews.

http://news.zdnet.co.uk/communications/networks/0,39020345,39192131,00.htm

The survey, released Monday by security company Mazu Networks and the Enterprise Strategy Group, found that almost 75 percent of companies boosted security spending in 2004 to comply with regulations set by the Sarbanes-Oxley Act.

Despite those efforts, only 14 percent of respondents said they were “very confident” that their networks would repel all threats this year.

“I think this is a bit of a wake-up call,” said Tom Corn, vice president of marketing for Mazu Networks. “Not a lot of folks have confidence that they have mechanisms and processes in place to protect themselves.”

The survey, which polled 229 information technology professionals about their corporate networks, came as another report suggested that virus writers and online attackers are becoming more focused on using their skills to earn cash from fraud and identity theft.

The polled IT professionals had a similar story to tell, according to Corn. “We are starting to see a lot of these threats less for bragging rights and more about creating armies of system zombies and bots–there is a strong financial model for that,” he said.

About 47 percent of all respondents had a worm infect a company network in the past year, the Mazu survey found.

An eighth of those businesses had more than 25 percent of their network compromised during the incident.

However, the worry of worms has not helped close some major vulnerabilities at the companies, the survey indicated.

Almost 25 percent of all companies had an internal breach in 2004, and 40 percent of those incidents interrupted a critical service.

Almost half of the IT professionals surveyed found active accounts belonging to ex-employees, and a third found rogue wireless access points in their network.

Companies involved in the survey were required to have at least 1,000 employees. They represented more than 18 different industries.

http://news.zdnet.com/2100-1009_22-5628715.html