Requirements for a system or data migration

Requirements for a system or data migration

Author: Martin Wiedenmann
Requirements for a system or data migration

A migration shall be carried out in such a way as to ensure the continuity of the accounting material. Special attention must be paid to the completeness and accuracy of the transmitted data, whether master or movement data. The data transfer project shall be documented in such a way as to enable an expert third party to verify the correctness of the data transfer within a reasonable time. Therefore, the coordination of the data transfer and its documentation should be integrated into the project from the very beginning.

Reasons and hurdles to migration

Anyone who operates or uses an IT system with stored or archived data and documents will be faced with a migration process at more or less continuous intervals. Reasons for this include, for example, company takeovers and acquisitions with subsequent homogenization of the systems, a change in technology and a new software process. This leads to various requirements when transferring data. The core task in data migration is to ensure the operational, regulatory and legal retention obligations so that a correct, complete and non-modifiable storage of data and documents can be documented.

The following challenges and risks may arise:

  • A loss of data due to inadequate strategy and monitoring.
  • A transfer of incorrect data because no analysis and error correction took place in the core data prior to the transfer.
  • A disregard of legal and operational requirements due to an incorrect migration strategy.
  • A forced termination of the migration due to miscalculation or insufficient cost and time management.
  • A lack of acceptance in the workforce due to inadequate training or preparation of employees.
  • A weak collaboration or delay with service providers due to undefined areas of responsibility and service delivery.
  • A long migration time because legacy data is spread across different storage media such as tape backups.

Requirements for documentation of migration

In order to ensure a comprehensible documentation of the migration to an expert third party, it is necessary to comply with a variety of requirements. These mainly relate to the project structure, the data transfer concept, the migration test and the proof of real data transfer. The following are examples of requirements and suggestions for the successful implementation of a migration.

In view of the project, it is essential to define a comprehensible overview and a clear timetable. This should include both, responsibilities and controls as well as the split into phases such as the design phase, the testing phase, etc.

When drawing up a data transfer concept, it is primarily necessary to provide an overview of the systems, methods, and the data, that’s supposed to be transferred.

The aim is to define the scope, manner, and nature of data, that’s supposed to be migrated from one to another system.

For this purpose, it is recommended to involve external auditors and consultants after analyzing the actual situation to ensure that all eventualities are covered.

Tests shall be performed before, during and after the migration project. Results should be appropriately documented, whereby any errors that may have occurred can be detected and solutions will be developed accordingly.

When real data is transferred to the new system, the “final balance sheet” of the prior system should be reconciled with the “opening balance sheet” of the new system to ensure the integrity of the records (if the balance sheet and the profit and loss are generated in this system). Furthermore, the entire process, including the transfer and error protocols, should be logged so that based there on further examination actions and troubleshooting may be carried out.

Archiving of historical data

All documentation created as part of the migration and the program versions used for productive data transfer must be kept for ten years in accordance with the legal requirements. Should the archived data system be abolished, outsourced or replaced, the data subject to recording and retention must be capable of quantitative and qualitative evaluation. This is governed by the “Principles for the Proper Keeping and Retention of Books, Records and Documents in Electronic Form and for Data Access” (GoBD).

In the context of migration projects, it must be ensured that the accounting-relevant data are fully and correctly transferred from the prior / source system to the new target system and that the procedures and controls applied in connection with the target system as well as the system settings made ensure that these data are processed in accordance with the commercial and tax law principles of proper accounting.

How can we support you?

Based on our experience, which emerges from numerous accompanying and downstream migration audits, we can advise you with our best-practice approaches and offer you the following audit services to avoid common pitfalls during your migration project:

  • give advice on how to reduce the effort involved in the overall project,
  • provide uniform, cross-project specifications for project documentation,
  • regularity,
  • early detection and reduction of accounting risks,
  • documentation of the test result,
  • quality assurance.