The assessment of the operating effectiveness of security controls by the information security risk assessment team s to ensure that information security risks and incidents do not occur or are managed effectively.
Internal information security controls’ operating effectiveness and efficiency are significant parameters in assessing the risk of data losses in any organization. One may have a view of the organization by understanding its internal controls and its operating effectiveness. It is not only necessary to design and implement the internal controls, but the main point is to ensure the operating efficiencies and effectiveness of the controls. Controls’ effectiveness means reducing the chances of fraud or identifying many information and data-related fraud risks with the help of implemented controls.
Evaluation of the Operating Effectiveness of Security Controls
The policies and procedures are reviewed to check their accuracy and coverage to evaluate information security controls’ operating effectiveness and efficiency. Procedures are required to cover all aspects and steps which form the overall process. The risk of overriding controls is also assessed. If the management finds that controls are easily overridden, it means that the chances of fraud are increased.
Management needs to take immediate steps to ensure that robust controls are designed and implemented with no chance of being overridden. Organizations use technology and artificial intelligence to build robust controls, eliminating the chance of overriding controls by employees or outsiders.
Management and employees are also interviewed to assess the internal controls’ operating effectiveness. The interviewer assesses the risks of fraudulent activities or related intentions during the interview. Interviewing the right people, cross-questioning, and emphasizing data access rights help identify and assess information security risks in different processes and departments of the organization.
Audit reports of the departments and processes, especially internal audit reports, also help assess the information security risks and breaches of data security controls. Internal auditors review the processes and transactions of different departments and compare the activities with the approved policies and procedures. Internal auditors perform a test of information security controls.
In case of deviations and breaches of information security controls by the employees and departments, internal auditors report such data breach or data control breach issues in the form of information security audit observations. Therefore, audit reports also serve as the reference point to identify the weak processes and controls which expose the organization to information security risks and incidents.
Internal auditors also perform data or information fraud investigations. Reasons for the occurrence of data or information frauds are identified, and the facts are discovered as to why data or information fraud incidents have occurred despite implementing information security controls. A review of internal auditors’ data or information fraud investigation reports also helps assess the weak information security controls and gaps that caused the particular data or information fraud.
As the internal audit reports and information or data fraud investigation reports are shared with Board Audit Committee or BAC, the board is updated about the information security risks and data-related fraud incidents that occurred and are reported within the organization.
BAC issues guidance regarding information security controls and a roadmap is provided to management to ensure that data or information fraud do not occur in the future.
The operating effectiveness of the information security controls is assessed by allotting “Control Risk Ratings,” such as the following:
– for Very Effective control
4 – for Effective control
3 – for Moderately Effective control
2 – for Marginally Effective control
1 – for Not Effective control
These ratings help the information security risk management team or respective process owner to identify the weak or missing information security control elements in the existing controls trajectory.
Final Thoughts
Activities of the employees are observed to identify any weaknesses in the data protection and access processes or the possibility of an employee breaching the data security controls. There may be situations that employees are not well trained or educated about information security controls, which is identified through observation of the employees while performing their duties.
Fraud investigators also test the transactions on a sample basis to identify those transactions where information security incidents occur or which may identify the data fraud risks. Walkthroughs of transactions and processes are also performed to ensure that information security controls operate effectively and efficiently.