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How’s your Information ‘Balance Sheet’ looking?

[Feb 11, 2011]

Like the majority of information system management & practitioners, I am not an accountant. But we all do (or should) have a basic understanding of the financial Balance Sheet. In simple terms, it shows at a point in time the value of assets minus liabilities resulting in equity (value). So how does this relate to information risk?

There is no disputing that in today’s business environment organizations are capturing, storing and moving more information than ever. As a risk-focused professional I immediately see how this information can represent both an asset and also a great liability.

As an example: A retailer which holds a vast database of information on its customer’s purchases, habits, and other information can be a great asset to the retailer’s marketing and management.

However, if that information is poorly managed or secured, the information also becomes a liability.

So I will end with this thought: What attention should be given when one look’s at their balance sheet and finds their liabilities are greater than their assets?