Soft Controls Scan
Quick and deep insight into corporate culture.
A culture of integrity is paramount to achieving goals and managing risks. Yet this human factor often remains hidden. With the Soft Controls Scan, you can measure and improve culture.
New guidebook
Soft controls in the audit
Learn to think practically about corporate culture, discover efficient ways to identify red flags.
Audit
Gain insight into the soft controls of your client as part of the audit.
Many accountants struggle with the new requirements to understand clients’ soft controls. After all, soft controls are factors that cannot be captured in “hard” structures and procedures, but are about an organisation’s culture and the behaviour of management and employees. Gaining objective insight into these is not easy.
Active Integrity’s Soft Controls Scan changes this. It gives accountants quick and in-depth insight into the client’s soft controls. The tool uses a scientific soft controls model and a validated survey method, both of which are recommended by the Netherlands Institute of Chartered Accountants. After the scan, a comprehensive Soft Controls Report is ready for the accountant to use to substantiate the audit.
Risk, Compliance & Internal Audit
Bring out hidden risks and get a grip on internal control.
A modern approach to risk, compliance or internal audit can no longer ignore culture. After all, many incidents and abuses can be directly explained by certain shortcomings in the culture. Soft controls help to uncover such shortcomings in time. However, professionals often lack the time and expertise to really get to work on them.
For those professionals, the Soft Controls Scan is a godsend. It can be easily deployed within companies and organisations and distinguishes between departments. The tool uses a scientific soft controls model in a survey method, which immediately reveals any shortcomings and signals. After the scan, a comprehensive Soft Controls Report is ready with facts, figures and insights.
HR
Strengthen integrity in the workplace and prevent misconduct.
Misconduct, fraud, bullying and sexual misconduct: a lack of integrity leaves deep scars. How great is the contrast with companies and organisations where integrity is secured in the culture. Their leaders are better able to attract, protect and retain talent. They see their reputation strengthen and their performance increase.
HR can now concretely manage integrity with Active Integrity’s Soft Controls Scan. This tool uses a scientific model in the form of a survey to provide figures on integrity culture. It helps employers create a work environment of integrity in which employees flourish, performance increases and undesirable behaviour is prevented.
Corporate Finance
Integrity due diligence for investments, mergers and acquisitions
Integrity is a metric that is all-important for the success of your investment. It is recognised by many investors, but taken well by few. A culture of integrity ensures strong performance and growth. But where integrity is flawed, we see the loss of talent, underperformance and reputational damage.
For investments, mergers and acquisitions, the Soft Controls Scan is a godsend. The tool uses a scientific integrity model in the form of a survey that can be quickly and easily administered to companies. Immediately after the scan, a comprehensive culture report is ready with facts, figures and insights. With the right cooperation, the scan can provide deep insights as early as 48 hours.
ESG
Corporate culture is part of the Governance pillar of ESG.
The European Union’s CSRD requires certain companies to disclose information on ESG. This includes information on business conduct, specifically ‘how the company establishes, develops, promotes and evaluates its corporate culture’ – ESRS G1-1↗.
To comply with this standard, companies must actively monitor and improve their culture. The Soft Controls Scan does just that. Moreover, the reports generated by the Soft Controls Scan contain pre-filled templates that enable smooth reporting in line with ESRS standards.
Our tool quickly maps soft controls.
Instant report
Immediate insight into soft controls with an independent report (pdf) as soon as the survey is completed.
Hard data about soft controls
Soft controls are inherently intangible and thus difficult to determine objectively. The Soft Controls Scan uses a best practice to map soft controls, namely with an anonymous employee survey. This gives each soft control a weighted rating, both for the organisation and per team or department.
Scientific model
Get access to the leading model for soft controls, without requiring your own expertise or experience. The Soft Controls Scan is built on this scientific basis. It makes soft controls practically accessible to accountants and professionals in, for example, risk, compliance, internal audit and HR.
Instant report
Instantly receive an independent Soft Controls Report (pdf) as soon as the survey is completed. You do not spend any time or expense on consultants. The report provides detailed insight into the soft controls within a company or organisation. Moreover, if there are any vulnerabilities in the culture, the report provides concrete recommendations to remedy them.
ACCOUNTANTS
Meeting NBA and PCAOB standards with the Soft Controls Scan
The overview below shows how the Soft Control Scan relates to the National Institute of Chartered Accountants (NBA) standards from Standard 315↗ and Handbook 1148. In addition, relevant standards from PCAOB Standard AS 2110↗ are highlighted. No rights can be derived from this overview.
Standard (summary)
Soft Controls Scan by Active Integrity
1
NBA Standard 315, para 21b
Identify risks of material misstatement, including by evaluating whether management has created and maintained a culture of honesty and ethical behaviour.
The NBA fleshes out this general duty with Guide 1148. See below how Active Integrity’s Soft Controls Scan relates to the standards in this guide.
2
NBA Handbook 1148, p. 8-10
Use models to visualise organisational culture. A validated model that is widely used in practice, and is well applicable in financial statement audits, is Kaptein’s model.
Muel Kaptein’s model (also known as the Corporate Ethical Virtues model or Soft Controls model) is integral to Active Integrity’s Soft Controls Scan.
3
NBA Handbook 1148, p. 11-12
Use techniques to analyse soft controls. For example, surveys, interviews, document analysis, group discussions and behavioural observation. If surveys are used, statistical analysis of relationships between groups or teams is possible.
Active Integrity’s Soft Controls Scan uses a survey to analyse soft controls. The outcome of the scan (a comprehensive Soft Controls Report) provides figures per soft control for both the client organisations as a whole, and the different departments, teams or office locations individually.
4
NBA Handbook 1148, p. 11
In the absence of in-house knowledge, use integrity experts to carry out specific work on soft controls.
Active Integrity’s consultants are experts in integrity and culture. They are used to carrying out analyses of companies and organisations based on soft controls.
5
NBA Handbook 1148, p. 13
Evaluate the “tone at the top” of the organisation, including the exemplary behaviour of management.
Exemplary behaviour is one of the eight soft controls assessed in Active Integrity’s Soft Controls Scan. Within the tool, it is possible to adjust the depth of the assessment based on the auditor’s wishes. Distinction between higher and lower management is possible in the assessment.
6
NBA Handbook 1148, p. 15
Evaluate soft controls to identify any significant deficiencies (“red flags”).
Active Integrity’s Soft Controls Report provides objective figures on a client organisation’s soft controls. These report figures are given both per department and per soft control, making it possible to identify red flags at a detailed level. In this, auditors can apply their own desired thresholds.
7
NBA Handbook 1148, p. 16
Report on the tremors and any (significant) deficiencies as part of the reporting on internal control.
Active Integrity’s Soft Controls Report is a representative document (.pdf) that can be attached to an internal control report. However, the auditor will have to incorporate and attach its own interpretation and conclusions based on the Soft Controls Report in its own report.
7
PCAOB Standard AS 2110, .24
Obtaining an understanding of the control environment includes assessing … whether sound integrity and ethical values, particularly of top management, are developed and understood
The Soft Controls Scan allows auditors to assess and quantifiably substantiate whether integrity and ethical values are present and well understood within a company, including in relation to senior management.
7
PCAOB Standard AS 2110, .73
Controls that address fraud risks include … controls designed to prevent, deter, and detect fraud, e.g., controls to promote a culture of honesty and ethical behavior.
Soft controls are designed to evaluate whether there is a culture of honesty and ethical behaviour. Deployment of the Soft Controls Scan makes it possible to assess whether there are deficiencies in the culture that lead to an increased risk of fraud.
Demo
Book a demo on the Soft Controls Scan and the Soft Controls Report
Do you want to know how the Soft Controls Scan works in practice? Or are you curious about the Soft Controls Report? By booking an online demo, you will learn more about the Soft Controls Scan and how you can use it as an accountant or as a risk, compliance or internal audit professional. You will, of course, have the opportunity to ask questions.