Cybersecurity as a cornerstone of sustainable supply chain practices

Integrating third-party control assessment into financial statement audits is crucial in today’s interconnected world. Phillipa Ngorima Systems Analyst Audit & Assurance

In today’s interconnected world, your financial security rests not only on your own doorstep, but also on the shoulders of your trusted partners. These are the companies you rely on for crucial services like data hosting, IT infrastructure management, and beyond. To navigate the complexities of contemporary business environments, organisations increasingly rely on collaborative partnerships with third parties to fulfill essential service needs.

However, while onboarding third-party capabilities can optimise business
operations, third parties come with their own set of risks and dangers. Therefore, integrating third-party control assessment into financial statement audits has become increasingly important. 

Imagine this: You have undergone rigorous internal audits and your own processes gleam. But a single security breach in one of your supplier’s systems exposes sensitive
data, disrupts operations, and shatters customer trust. In 2024, with rampant cybercrime, complex global partnerships, and data privacy regulations tightening, ignoring supply chain security is a ticking time bomb. Forgetting your vendors’ security posture is like locking your front door but leaving the back window wide open – a glaring vulnerability in today’s digital storm. 

The reality is that many businesses are oblivious to the hidden risks lurking in their third-party ecosystem. Weak vendor controls, insecure infrastructure, and unintentional data breaches can leave your financial data exposed and your reputation vulnerable. This isn’t only about protecting your immediate finances; it’s about safeguarding your organisation’s future. 

And here’s how businesses can take control of vendor-managed controls:

1. Leverage third-party security assessments

Evaluating vendor controls by leveraging IT expertise and implementing their recommendations can significantly improve the overall security of your organisation. Like vigilant scouts, they map your vendor landscape, pinpoint vulnerabilities, and
recommend robust countermeasures. They act as shields against data breaches and cyberattacks, pave the path to compliance, and provide the cornerstone for trust-building
partnerships.

2. Prioritise data security

Building an impregnable internal fortress won’t suffice in today’s hyperconnected world. Your success is ultimately tethered to the strength of your weakest link, including your
partners. To be cyber-resilient data security should be weaved into any business’ DNA and get the same from vendors. Integrating best practices into vendor selection and management mitigates financial and reputational risk, unlocking secure and sustainable partnerships. Pre-screening vendors through security questionnaires, conducting risk assessments and utilising tools like SIEM platforms are key steps in building your cyber-fortress.

3. From trust to verification: proactive engagement

Blind trust is a luxury no business can afford. Real engagement goes far beyond checking boxes. It’s about actively participating in vendor training, sharing security insights, and promptly addressing any concerns. By actively monitoring and mitigating risks, you can transform potentially vulnerable vendors into invaluable partners in building robust cyber defences.

Ready to build a resilient future where trust and security go hand-in-hand?

Contact PKF today and learn how our integrated third-party security assessments can safeguard your financial data, fuel your growth, and position you for success in a world where resilience is the key to thriving.