SAP Risk and Assurance Management offers six main capabilities that help organizations manage enterprise risks, internal controls, and compliance obligations effectively:
- 1. Risk Management
- Document and maintain a centralized risk register for enterprise-wide visibility
- Perform qualitative and quantitative risk assessments using defined methodologies
- Link controls and mitigation plans to identified risks
- Track risk treatments, monitor progress, and evaluate risk responses
- Schedule periodic risk reviews and automate risk re-assessments
- 2. Control Management
- Design and document internal controls for compliance and operational risk management
- Link controls to relevant business processes, organizational units, and risks
- Assign roles such as control owner and control performer
- Manage control lifecycle, including periodic review and approval workflows
- Support manual and automated controls, including SAP system-integrated controls
- 3. Control Execution
- Schedule and perform automated and manual controls
- Detect policy or process deviations using real time monitoring
- Track control execution history for audit and compliance documentation
- 4. Result Processing
- Analyze test results to identify control failures or exceptions
- Classify issues by severity or business impact
- Document root causes and link findings to controls and risks
- 5. Issue and Remediation Management
- Manage issue and action lifecycle, from identification to resolution
- Assign responsible users for remediation actions
- Track progress and completion of corrective measures
- Maintain full audit trail for issue history, evidence, and resolution timelines
- 6. Reporting
- Generate real-time dashboards and reports to monitor compliance and control assessments.
Lets understand what are the main entities to cover those key capabilities.
SAP Risk and Assurance Management involves several main entities that help organizations manage risk effectively and ensure regulatory alignment across business operations.
Let’s explore each main entity:
- 1. Automated and Manual Procedures – Building the Foundation of a Control
- During the definition phase, you must create both automated and manual procedures, which together form the basis of a control.
Understanding the Difference:
- Automated Procedures:
- Automated Procedures are system-driven checks and controls that continuously monitor processes for compliance, detect anomalies, assess risks, and ensure internal controls are operating effectively. It minimizes manual effort and enhance audit reliability.
- Manual Procedures:
- Manual procedures are user-driven activities such as control testing, risk assessments, documentation reviews, and audit interviews that require human judgment, analysis, or validation where automation isn't feasible or appropriate. There are two formats:
- Step-Based Execution: Users follow a predefined sequence of steps to execute the control.
- Survey-Based Process: Information is collected via structured surveys or questionnaires distributed to relevant stakeholders.
Together, automated and manual procedures build a control.
- 2. Control – The Operational Heart of Assurance
- A Control represents a specific check or action designed to mitigate risk or enforce compliance. It is the core operational element within the assurance framework which is direct, measurable, and aligned with defined business objectives.
Each control is enriched with master data, including:
- Associated organizational units
- Business processes
- Applicable regulations
- Linked risks
- 3. Work Package – The Execution Container
- A Work Package plays a central role in the execution phase of SAP Risk and Assurance Management. It serves as a container that bundles and organizes related controls, providing structure and oversight throughout the control execution process.
Key Functions of a Work Package:
- Bundling Controls: Groups together related controls—automated or manual—that need to be tested or executed.
- Scheduling: Defines when controls should be executed—whether periodically, on specific dates, or in response to organizational events.
- Assurance Actions: Supports various assurance activities, including control performance reviews, effectiveness testing, or assessments.
By managing controls and execution settings centrally, Work Packages help organizations standardize and streamline assurance and compliance activities.
- 4. Issue Processing – From Detection to Action
- Once a Work Package is executed, the system generates an execution report using color-coded indicators to show which controls passed, failed, or flagged issues.
This report marks the beginning of the issue investigation process, providing an immediate overview of execution outcomes and highlighting items that require further attention.
- 5. Issue, Remediation, and Task Templates – Closing the Loop
- After issues are identified, the remediation process begins. This ensures that corrective actions are defined, implemented promptly, and tracked effectively.
Task Templates help manage remediation by providing:
- Clear step-by-step instructions
- Assigned responsible team members
- Expected timelines for resolution
Using templates ensures adherence to organizational protocols and supports timely, aligned remediation efforts.
Each of these main entities plays a critical role in SAP Risk and Assurance Management. Together, they enable a disciplined, transparent, and systematic approach to managing risk, ensuring compliance, and driving continuous improvement.