Five Compliance Best Practices For … Internal Controls And SOPs

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Foley & Lardner

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Foley & Lardner LLP looks beyond the law to focus on the constantly evolving demands facing our clients and their industries. With over 1,100 lawyers in 24 offices across the United States, Mexico, Europe and Asia, Foley approaches client service by first understanding our clients’ priorities, objectives and challenges. We work hard to understand our clients’ issues and forge long-term relationships with them to help achieve successful outcomes and solve their legal issues through practical business advice and cutting-edge legal insight. Our clients view us as trusted business advisors because we understand that great legal service is only valuable if it is relevant, practical and beneficial to their businesses.
As an accompaniment to our biweekly series on "What Every Multinational Company Should Know About" various international trade, enforcement, and compliance topics...
United States Intellectual Property

As an accompaniment to our biweekly series on "What Every Multinational Company Should Know About" various international trade, enforcement, and compliance topics, below find an update to our series on compliance checks that every multinational company should consider. Give us two minutes and we'll give you five suggested compliance best practices that will benefit your international regulatory compliance program.

Drafting effective internal controls and standard operating procedures (SOPs) is essential for ensuring consistency, efficiency, and compliance with organizational policies and regulatory requirements. Internal controls are one of the ways in which organizations implement their compliance dictates and, along with compliance policies and compliance training, are the three-legged stool of compliance.

Five compliance best practices for drafting internal controls and SOPs are as follows:

  1. Define Objectives: Clearly define the objectives and purpose of the internal controls and SOPs. Identify the desired outcomes, performance expectations, and compliance requirements that the controls and procedures aim to achieve.
  2. Involve Key Stakeholders: Engage key stakeholders from across the organization in the process of drafting internal controls and SOPs. Collaborate with process owners, subject-matter experts, compliance officers, legal counsel, and frontline employees to gather insights and perspectives.
  3. Document Current Processes: Document the existing processes, procedures, and controls currently in place within the organization. Review existing documentation, workflow diagrams, and job aids to understand how work is currently performed and where improvements may be needed.
  4. Standardize Format and Structure, and Use Clear and Concise Language: Standardize the format and structure of internal controls and SOPs to ensure consistency and clarity across documents. Use headings, subheadings, numbering, and bullet points to organize information logically and facilitate navigation. Also, use clear, concise, and easily understandable language in drafting internal controls and SOPs. Avoid technical jargon, complex terminology, or unnecessary detail that may confuse or overwhelm readers.
  5. Include Detailed Instructions: Provide detailed instructions, step-by-step procedures, and clear guidelines for performing each task or activity outlined in the SOPs. Include specific actions, responsibilities, timelines, and performance expectations to guide employees effectively. Document the approval process for internal controls and SOPs, including the individuals or committees responsible for reviewing and approving changes. Establish procedures for periodic review and updating of controls and procedures to ensure relevance and effectiveness.

Make internal controls and SOPs easily accessible to employees through centralized repositories, intranet portals, or electronic document management systems. Ensure that employees can access the most up-to-date versions of procedures whenever needed.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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