In recent years, a spate of mergers across Canada has allowed Local Distribution Companies (LDC) to cut costs, improve service to local communities and drive operational efficiencies. To unlock the full value of a merger, however, the merging companies need to integrate their processes— and that starts by standardizing their internal controls.
Without a streamlined internal controls environment, employees may struggle to understand which processes to follow, which can heighten enterprise risk— especially if key activities fall through the cracks. To mitigate these risks, LDCs may want to begin by automating their controls. In addition to reducing the errors associated with manual processes, automation typically delivers significant efficiencies, including speeding up routine processes while minimizing the unsanctioned workarounds that sometimes lead to fraud.
At the same time, it’s important to recognize that this isn’t a “once and done” exercise. To keep pace in a rapidly evolving industry, LDCs should re-evaluate their controls framework on an ongoing basis. This means revisiting your controls regularly to make sure they’re still relevant and testing them to confirm they continue to operate effectively. It’s also important to formally document your processes— both so staff understand what’s expected of them and to prevent losing critical process knowledge if key employees change jobs, head out on parental leave, take extended leave or retire.
With the right internal controls in place, LDCs can gain the confidence they need to help ensure that their risks are being properly managed. This can free them up to focus on the core strategies that will drive their growth into the future.
For more information on how we can help LDC’s smoothen the transition, click here or contact: