7EVENTS > 7.3 What is an event?

This question is particularly relevant when addressing “near misses”. To be relevant everyone involved in recording incidents needs to understand what constitutes an “event”. An example may serve to illustrate the potential problem:

•A bank reconciliation contains 20 reconciling items, 10 are due to miss-postings in the General Ledger; clearly these are events since had they not been detected the organisation’s financial records would be wrong. Of the remainder, 2 are duplicate payments – again clearly “events”, 7 are timing differences, items posted to the organisation’s accounts but not yet on the bank statements – are these events? Might they become “events” if they do not appear on the bank statements, and how long should we wait until we record them? The final item is an entry appearing on the bank statement but not in the General Ledger. This needs investigating, it could be a fraud – in which case it is not a “near miss” it is a real event – or it could turn out to be a miss posting, in which case it is a “near miss event”, but how long do we take before deciding which it is?

This example demonstrates that it is not a straightforward thing to install an Event Tracking system. To do this properly an organisation needs to prepare a document which:

•Clearly defines what an event is

•Clearly defines what does not constitute an event

•States that anything which does not fit into the two earlier categories is sent to a specified senior person to determine as to which category it falls into.