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Compliance Technology Spend Still Climbing

Companies spent some serious money in the compliance management technology market last year, and they're not ready to put away the checkbook just yet. While total compliance spending will be around $6 billion in 2006 -- down slightly from last year's $6.1 billion -- the technology component of that expenditure will continue to increase, from $1.7 billion in 2005 to almost $2 billion this year, according to AMR Research in Boston.

That's good news for compliance assistance software vendors, most of which are gearing up for another banner year. Activ-ity is particularly brisk in the business assurance and controls monitoring section of the market. After a slow start, interest in these tools is picking up as finance executives seek to embed their organization's internal controls in sustainable processes.

LogicalApps, a provider of embedded governance software for enterprise applications, doubled its workforce in 2005 and expects to double its revenue this year. "In 2006, we will see a big surge in the market as customers evolve from documentation of controls to actually embedding automated controls directly into their ERP applications and business processes," says Chris Capdevila, CEO and co-founder of the Irvine, Calif.-based company. "This is the key to achieving significant cost savings, risk reduction and business efficiency gains from a company's compliance initiatives."

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