Some of these proprietary ERP software packages are written from scratch; others are crafted from highly configurable third-party software packages. In all cases, this trend has affected both large and complex hospital networks and smaller medical practices. This search for differentiation and competitive advantage through highly customized, highly integrated software is not limited to the healthcare industry; it also exists in the communications, healthcare, government, not-for-profit, construction, and logistics sectors, to name just a few.
And as with any burgeoning technology, with growth comes increased complexity and increased risk. Risk from specialized software first develops when a company fails to adhere to best practices during development or customization. Proper segregation of duties among the development team members is vital: the analyst, programmer, quality control department, and user should be discrete and sequentially responsible for their individual roles during the implementation process.
Either in an attempt to launch new software quickly or by simple inattention, high-level managers often fail to implement such a segregation of duties. As a result, even flagship, mission-critical software products may lack basic quality and roll into production with potentially destructive bugs unnoticed.
Even if the development team follows best practices, other risks associated with specialized software may remain. More so than off-the-shelf software, internally developed or customized software packages may not be created with sufficient documentation or implemented with sufficient testing.
In addition, third-party developers may functionally abandon commissioned software after moving on to new projects, making updates or bug fixes more difficult to come by.
In highly regulated environments—especially those that may require audits of operational software—these risks can be significant. Finally, failure to develop or customize software according to best practices may pose a risk that financial reports from the production side of the business will be inaccurate, as well as a risk that that these inaccuracies will not be not caught by the accounting and finance cycle managers in a timely fashion.
In an effort to cut costs, a business may not spend the time and money required to add audit functionality to its internally developed software, leaving it entirely reliant on software that cannot be tested for accuracy.
As a result, there is a real risk that profitability may be overstated risk of failure or understated risk of lost opportunities. The discarding of obsolete technology is a byproduct of acquiring new technology. Though many businesses hold on to technological assets far past their expiration date, it is generally accepted that most technology can be considered obsolete after only 18 months.
In a period of accelerated growth, older technology is discarded even more quickly. Such discarded technology introduces the risk of data loss or unauthorized distribution of confidential data. Hard disks, workstations, servers, multifunction copiers, mobile devices, and many other technologies all may have sensitive data stored in their memory when discarded.
Businesses must recognize the risks associated with decommissioning technology and ensure that the technology they discard is properly cleared of sensitive data before it is disposed. The degree of risk associated with acquisition, adaptation, and disposition of technology is ultimately determined by the people interacting with that technology. As such, managers and auditors must assess the risks of human use and misuse of any technology, both intentional and unintentional. For example, many businesses are turning to remote access and telecommuting in hopes of increasing productivity and accommodating alternative work schedule needs.
Though most regard this as a positive development, telecommuting is fraught with risks of unauthorized data access. Tools such as encryption and training must be utilized to ensure that controls over authentication knowing who is accessing data and authorization ensuring that the user has access to the right data and nothing more are effective. Technology professionals often express the opinion that people are not good at keeping data safe.
Technology has become more complex, but human brains keep making the same mistakes. To make matters worse, information extracted from these methods which include collection and aggregation of data from public sources is compiled and made available in online black markets. Human capital may increase technological risk, but the workforce need not be replaced with robots just yet.
A business that is aware of these risks can work to mitigate them, and the first step is, of course, a proper risk assessment. In recent years, there have been an alarming number of high-profile security breaches, including at such large corporations as Target, Home Depot, Wyndham, Anthem Health, and T-Mobile.
These breaches are particularly troubling because these companies presumably had the resources and opportunity to conduct a risk assessment and take steps to mitigate their data risks.
Risk can then be managed in one of four ways: avoid the activity that creates the risk, reduce the risk by mitigation, reduce the risk by sharing the consequences with others, or accept the risk.
Risk management is often partially controlled by cost-benefit calculations. Development language and frameworks may be different but development approach should be standardized. Here, I am sharing my checklist which I mostly refer for audits. These are just guidelines, as scope of audit varies from project to project. So after reading these details, you should create your own checklist. Without a standard to follow, each developer and sometimes each file will take on a standard of its own or be just a random mash of whatever.
A project should be defined with coding standards and guidelines, which every developer has to follow. Coding standards can be followed at various levels e. Coding guidelines are used to have uniform structure in source code. Error handling takes two forms: structured exception handling and functional error checking.
Applications should always fail safe. If an application fails to an unknown state, it is likely that an attacker may be able to exploit this indeterminate state to access unauthorized functionality, or worse create, modify or destroy data. The code should not contain comments that suggest the presence of bugs, incomplete functionality, or weaknesses.
Others indicate code problems that programmers should fix, such as hard-coded variables, error handling, not using stored procedures, and performance issues. If you are a software coder or manufacturer, your intellectual property is critical to your business.
After all, your primary product is your original code. If that code is used or misappropriated by a competitor, your business will suffer. One relatively easy strategy for preventing this situation is using copyright notices. Clear copyright should be asserted by whoever will be the appropriate party to own copyright on this application. Use appropriate design pattern if it helps , after completely understanding the problem and context.
But if any design pattern is implemented, then software should follow and implement in right way. You also need to check that the data released is not providing any unnecessary data that can be used to make assumptions against you. After the data has been gathered, the auditors will present you with their Estimated License Position ELP of your software environment, which will consist of your deployment data, compared against your licenses to create a compliance gap.
They will ask you to review their findings before they send it over to the software vendor to correct them on any errors. The ELP will be composed of thousands of rows of data and will be tremendously difficult to read through in the amount of time the auditors will give you. After the data has been sent off and the fact-finding portion of the audit is closed, the vendor will begin setting up a timeframe for purchasing any license shortfalls.
Going off of the compliance gaps the software auditors have found, the vendor will sit down with you to hash out a negotiation for how you will make up for any shortfalls. This is often where companies feel disheartened, tired, and cornered. They just want the issue to go away and feel as if the compliance gaps the auditors have found is set in stone. Stakeholders involved in the audit include:. All of these different teams might be compensated in different ways: one team might be paid based on the revenue they manage to obtain, while another on whether this audit is conducted according to legal standards or on how satisfied you are with their work.
You need to word your requests in a manner that appeals to all stakeholders involved. Take comfort in the fact that you have done everything you possibly can to prepare for this software audit. Do not be pressured into timelines. Do not be forced into a settlement that is not accurate because you were not given enough time.
A well-timed call to the right person can be very effective to unblock a stalemate in the process. Just when you feel cornered in the software negotiations, you can expect to be pushed towards purchasing new products.
You must stay focused and strategic with your software purchases regardless of the pressure the software audit puts you under. During the negotiation process it is important to remember that it is a balancing act between four key factors. Make sure you get a closing statement after final figures have been decided at the end of the negotiation.
Some vendors may indemnify you from future audits by looking back past the date the audit closed. A closing statement will give you the freedom of not having to worry about another audit from that vendor for a minimum timeframe or else they will be at liberty to audit you using findings that date back prior to the close of the audit.
Software audits can be exhausting and probably far outside the scope of what you were thinking your job would look like. However, it is possible to get through just fine by following the software audit checklist, remaining calm, staying focused, and having the right people on your side.
Software Audit Checklist. Phase One: Notification Upon receiving a notification that you have been selected for a software audit, you will need to do these first steps immediately. Determine If You Must Respond While you are legally obligated to participate in a software audit, not everything that is dressed up to look like a software audit is one. Therefore, determine if you have to respond and plan accordingly.
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