Finance Essay Paper Sample on ROI Part 4

ROI Part 4

Post implementation audit (PIA) on a new information technology system will be important in proving its value to the organization. It is specifically significant in evaluating the hard and soft returns obtained from the system, including the reliability of the system and how successful the process of its implementation has been. The audit will assist in finding out whether there were any miscalculations in both hard and soft costs of the projects or the hard and soft returns resulting to a ROI that is either above or below what had been projected based on those calculation. It will assist in determining the savings in terms of costs for a certain financial period such as yearly or monthly proving the worthwhile of the project. It will be possible to come up with recommendations on any improvements required for the new system and also provide lessons on how to go about any other projects in the future.

To carry out the post implementation process audits successfully, there are steps to be followed and certain factors that are necessary. Firstly, the organization should ensure there is no resistance to the audit process by enhancing the involvement of all staff members in conducting and providing feedback on PIAs. All the necessary information is collected even before the PIA commences. This is done by having all documents pertaining to the project such as business projections report outlining expected costs, benefits and ROI; the timeline of the project comprising of key metrics, a list of technical items needed by the system; project milestones as well as security and financial controls incorporated in to the system.

The right people to be engaged in the audit team should be carefully selected and they ought to include IT and business staff members taking part in the implementing the project and organization’s internal audit department representatives. The proper timing of the audit should also be determined, this will involve finding out the time that the system will take before it generates some data or results and the time it will take for staff members to know how the system operates. The audit can hence be scheduled a few months after its implementation has been completed. The PIA should start by having a meeting with all the team members to identify the activities and requirements of the audit process.

The next step would be reviewing all the documentations that were initially collected before the PIA. The auditing team will then note their findings in the audit report concerning the status of records and documents reviewed. In case they are not well kept, they will record that the implementing team ought to keep proper records. The audit team will further carry out scheduled interviews and circulate satisfaction surveys to users of the system. These two will assists the team members to find out how successful the project was in meeting its set objectives and also help in collecting constructive feedback that will be used for continuous improvements. The controls in the systems such as the security and financial controls are also tested to find out their effectiveness in terms of serving their purpose such as; is there any authorization requested by the system before logging in and does everyone have the right to access everything within the system or are there specific rights to different staff members. In addition, do the financial controls ensure all the right accounting procedures are followed to prevent fraud; is it possible to have an audit trail for all transactions in the system.

The other step is finding out whether the systems data is reliable to be used in carrying out further evaluations, this is done by; comparing the information in the system with any hard data available to find out whether they match; sampling of a number of transactions is done to ensure their processing is well done. The business staff members then conduct a financial review of the system to find out the payoff. This is done by subtracting the both hard and soft costs from the hard and soft benefits. The resulting payoffs are then compared with what is in the business case target to know whether the system has achieved its target.

A meeting is then convened by the audit team members to discuss the activities of the implementation as well as PIA process to identify what may have gone wrong in both and establish specific areas that need improvements. A report is then prepared and made accessible to all members of staff for instance through the organizations internal website. A copy of the report is also submitted to the senior management with a summary of the key findings so as to play their role in implementing any recommendations suggested. Valuable lessons learnt from the PIA of the project are also highlighted so that they can be applied in any future projects.  

The post implementation audit helps in continuous improvements of projects, evaluating the expected both hard as well as soft costs and their benefits to determine the success of the project and its implementation in achieving the projected ROI. The audit process should therefore be conducted as soon as the project is implemented with the assistance an audit team comprised of key staff and adequate documentation. The PIA process results to valuable lesson for both the current project being implemented as well as the future projects in the organization.