United Arab Emirates
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Increased Costs
Ransomware can prevent workers from accessing any IT systems unless the company pays off the hackers. This creates a major financial burden. Hiscox estimated that 6% of companies paid a ransom in 2019, creating 381 million in losses.
Business also must hire lawyers and other experts to remain compliant with cybersecurity regulations. If they are the victim then they might also have to shell out more for attorney fees and damages because of civil cases against the company.
In 2017 Equifax a top three credit bureaus had a data breach which compromised personal data of 147 million customers. This resulted in subsequent litigation, the company paid up to $425 million to assist affected individuals.
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Operational Disruption
In addition to actual financial damages, companies often face indirect costs from cyberattacks, such as the possibility of a major interruption to operations that can result in loss of revenue.
Cybercriminals use many ways to affect a company’s normal activities, its either by infecting computer systems with a malware that deletes high-value information, or by installing malicious code which blocks access to your website. This all causes a huge operational disruption.
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Altered Business Practices
Cybercrime affects businesses in more than just financial ways. Companies have to alter the way they store and collect information to ensure the sensitive information isn’t vulnerable. Many companies have stopped storing customers’ financial and personal information, such as credit card number and birth dates.
Many companies have shut down their online stores out of the fear that they can’t protect themselves against cyberattacks. People are now more aware about their digital data and are interested in knowing how the businesses deal and handle with security issues, and they are more likely to patronize businesses that are up front and vocal about the protections they have installed.
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Reputational Damage
Companies that fall victim to larger cyberattacks may find their reputation significantly damaged. Customers and suppliers may not leave their sensitive information in the hands of a company whose IT infrastructure was hacked at least once before.
Target has a data breach in 2013 where they lost credit card information of more than 40 million customers, this hurt their reputation and cost them $18.5 million.
Publicly traded companies see a short-term drop in market value if affected by cybercrime. Research suggest that share prices of affected companies fell an average of 3.5% following an attack and lost 3.5% in Nasdaq.
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Stolen Intellectual Property
A company’s product designs, technologies, and go-to-market strategies are among the most valuable assets. Intangible assets accounted for 87% of the value of S&P 500 companies in 2015, according to intellectual property advisory Ocean Tomo.
These intellectual property is stored in the cloud, which makes it very vulnerable. According to reports 30% of U.S companies have their intellectual property stolen by cyberhackers within the past 10 years.
Premier Brains IT audit team examine and evaluate organizations information technology infrastructure, policies and operations.
Information technology audits determine whether It controls protect corporate assets, ensure data integrity and if they are aligned with the businesses goals. Premier Brains examine not only physical security controls but also overall business and financial controls that involve information technology systems.
The primary objective of an IT audit include:
- Evaluate the system and processes to secure company data.
- Determine risks to a company’s information assets, and help to minimize those risks.
- Ensure information management processes are in compliance with IT laws, policies and standards.
- Determine inefficiencies in IT systems.
Please note that this memo is for information purposes only and should not be construed as an advice. It does not necessarily cover every aspect of thetopics with which it deals. You should not act upon the contents of this alert without receiving formal advice on your particular circumstances.
If you would like to discuss Accounting, Audit or Tax services, please drop us an email at info@premier-brains.com or call us at + 971 4 3542959.
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