Easing the Compliance Burden and Risk Will Drive Significant Investment in Financial Compliance Applications, IDC Reveals
FRAMINGHAM, MA – APRIL 5, 2005 – According to a newly released IDC study, the market for financial compliance applications will grow from $1.1 billion in 2005 to over $2 billion in 2009, experiencing a 17% compound annual growth rate (CAGR). The new financial regulatory environment, which includes among others Sarbanes-Oxley (Sarbox) and International Financial Reporting (IFRS), has identified the corporate need for applications that support managing the internal and business control environment as well as transparent and flexible financial reporting. Investing in these solutions will support near-term compliance requirements and yield more far-reaching organizational benefits such as managing enterprise risk and business performance management.
"Financial compliance will drive direct spending on technology in three key areas: financial reporting and analysis, compliance management solutions, and business assurance analytics," said Kathleen Wilhide, director for Compliance and Business Performance Management Solutions at IDC. "Spending drivers include achieving a sustainable level of compliance that decreases costs and risk, putting in place compliance systems of record, and enhancing the reporting and control environment with robust reporting systems and transactional level analysis that increases visibility into high risk areas."
Financial compliance applications will achieve significant growth over the next five years, with initial efforts focused on packaged compliance management applications and financial consolidation systems.
"Organizations are just beginning to make investments in technology to support sustainable compliance," added Wilhide. "As a result of year one of Sarbox, the use of technology to integrate business control processes, statutory and management reporting, and integrated document and records management has become apparent."
The IDC study, Worldwide Financial Compliance Applications Market Forecast 2005-2009 (IDC #33069), introduces the emerging market for financial compliance applications, and defines the software solutions which make up IDC's view of the market. The study also includes the worldwide financial compliance applications market forecasted for the period 2005-2009, and a discussion of current and future market dynamics.
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