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Maintaining an Effective Control Environment / Stewardship�December 2022

Global Controller Organization

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Finance

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Poll: Do you have more supply of toilet paper today than you did pre-pandemic?

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Kimberly-Clark

Global Controller Organization

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Finance

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Poll: What does stewardship mean to you in relation to your role as a Finance leader?

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Stewardship

Global Controller Organization

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Steward –

CFOs work to protect the vital assets of the company, ensure compliance with financial regulations, close the books correctly, and communicate value and risk issues to investors and boards. (Deloitte’s Four Faces of the CFO)

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Is your company maintaining an effective control environment?

Global Controller Organization

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Dutch Bros…..material weaknesses in our internal control over financial reporting due to limited accounting department personnel capable of appropriately accounting for complex transactions.....internal control deficiencies…..were determined to be pervasive throughout the Company’s financial reporting processes.

Peloton Shares Fall 15% After Company Warns Of Accounting Problem (Baystreet, Aug. 27, 2021)

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(Securities and Exchange Commission, Sept. 3, 2021)

(Securities and Exchange Commission, October 26, 2022)

(Form 10-Q, March 31, 2022)

Never seen ‘such a complete failure’ of corporate controls, says new FTX CEO who also oversaw Enron bankruptcy

Newly appointed FTX CEO John Ray scorched Sam Bankman-Fried for a total absence of trustworthy data and lack of financial safeguards.
Ray disclosed that he had no confidence in the balance sheet statements of Alameda, FTX, or their subsidiaries.

CNBC.com Nov 17, 2022)

SEC Charges The Kraft Heinz Company and Two Former Executives for Engaging in Years-Long Accounting Scheme

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Finance

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Poll: As your company is growing and / or going through a digital transformation, what are you doing to ensure the control environment is effective and you are being a good company steward of the company?

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Transforming while pressure to deliver the numbers?

Global Controller Organization

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Pressure to meet Wall Street’s expectations

Budget Constraints

Digital Transformation

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Finance

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Poll: Is a control deficiency looked upon as a growth opportunity or as something bad? Why?

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How do you maintain control through all the change?

Global Controller Organization

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Setting the right tone at the top
Doing the basics (ERM, control mindset, monitoring, validation)
Simplify, automate and think globally
Challenge the status quo
Do it right no matter how small, it will grow
Understand why, not just how
Internal controls must evolve as the company evolves