Approval and Authorization Process

An approval and authorization process, including delegation levels and owner signoff procedures, should be developed to align with the organization's requirements. These procedures will need to be agreed by the Chief Executive Officer and the Chief Financial Officer. The key to any validation process is the quality of the decisions it promotes and the uniformity in which it is completed. It is important to realize that the validation process needs to vary to match the risk associated with the proposed investment or project. Different capital expenditure proposals represent different risk exposures. They need different validation techniques to ensure that the investments that are finally approved are in fact the best ones the organization can make.