Law 262 has extended the authority of auditors, supervisory boards and management control committees of public companies in Italy. These internal control bodies can now directly request information on specific transactions or the overall financial status from either senior management or the appropriate control bodies in the company’s subsidiaries.

This law also regulates the criteria for selecting managers responsible for preparing and filing statutory reports in line with Article 154-bis. Both the managing director and statutory reporting manager must now sign all public acts and disclosures relating to periodical and annual financial statements.

Monitoring compliance requires:

• Managing each process in line with compliance regulations
• Identifying risks related to control procedures
• Processing reports
• Managing the audit trail
• Documenting applied control mechanisms

Complications within group organizations

CFOs of large organizations must also certify the financial statements produced by their subsidiaries – even when these administrative accounting processes do not directly fall under their supervision. This leaves CFOs of large organizations with one of three options:

1. To play an active role in local budget processes (only viable for small groups)
2. To delegate responsibility for the accuracy of local financial data to a process “owner”
3. To create a chain of action in which the CFO certifies the accuracy of the consolidated financial statements

Why Tagetik CPM?

Tagetik CPM helps financial departments comply with law 262/05 by uniting the processes of financial closing, intercompany reconciliations, consolidation, allocation, cash flow and financial reporting to ensure:

• Traceability: Use double-entry accounting for maximum control of your data
• Financial control: Access detailed data at different stages of the process
• Process control: Manage workflow at all levels

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