EDI Audit and control, legal and accounting issues
One area where functional management may wish to become significantly involved is with issues revolving around audit and control. Even with high volume EDI transactions, functional management may wish to have:
- Inquiries showing volumes of transactions sent or received;
- Inquiries showing invalid transactions that could not be processed by receiving application systems;
- Audit reports verifying number of transactions processed by sending or receiving systems as compared to transactions processed by EDI translation software;
- Archive capabilities for selected EDI documents over a specified period of time for certain EDI transactions, at either a detail or summary level.
As a general rule, archive EDI documents for the same retention periods as their paper document counterparts. There are also Internal Revenue Service procedures which require certain EDI data to be kept for seven years. The EDI system theoretically will be subject to audit by internal and external auditors, as well as the IRS. The EDI system should provide validation, audit trails, control, and transaction logging.
It is important that all legal, accounting, and financial communications be determined and agreed to by both parties implementing EDI. Without paper, trading partner agreements are being utilized to a limited degree in EDI relationships to replace or supplement the legal requirements carried on paper document.
To learn more about EDI and become a CEDIAP® (Certified EDI Academy Professional), please visit our course schedule page.