NERC Releases Internal Controls Guide

On July 9^th NERC released Reliability Assurance Initiative (RAI): Release of Internal Controls Working Guide. The Internal Controls Working Guide was a collaborative effort between NERC and working groups comprised of industry experts.

Implementation of the internal controls has finally made it to the NERC world which is going to be good for the industry. It was first defined by American Institute of Accountants (now the AICPA) and then adopted by several other standards and regulations such Foreign Corrupt Practices Act: Took the language of the 1972 AICPA pronouncement and made it a law.

An internal control program will help provide Registered Entity with reasonable assurance of compliance and reliability with the requirements of the Reliability Standards.

According to the guide, registered entity’s internal control program should typically consist of processes, practices, policies or procedures and should address risks associated with the reliable operation of its business. Basic control elements may include: oversight, risk assessment, controls activities (e.g., operating instructions, maintenance testing, exception reports, dashboards, alarms and alerts on operational controls), communications and training, and monitoring.

There are various internal control models that entities may choose; however, NERC recommends that the model that utilities implement should include these components:

• Control Environment
• Risk Assessment
• Control Activities
• Information and Communication
• Monitoring

Putting these internal controls manually can be cumbersome and a daunting task. If you read my other blogs, you can tell where I am going with this. I am a big advocate of leveraging technology to enable an organization to stream line their compliance business process and management systems.

We can help you implement internal controls model through our PREDICT360 Utility Centric GRC software that will help you comply with reliability standards along with all your other multi regulatory compliance issues across all the departments through cloud-based application. You will always be “Audit Ready” with the ability to access all current regulations and laws related to your policies and procedures.