The Ultimate ERP Security Checklist: What Every Business Must Audit Annually

Enterprise Resource Planning (ERP) systems are the backbone of modern businesses. They handle financials, supply chain management, HR, and critical company data—all in one place. But with great power comes great responsibility, and ERP systems are prime targets for cybercriminals.

The problem? Many businesses assume that once security measures are in place, they’re set for good. However, security threats evolve, employees change roles, and compliance requirements shift. Without regular security audits, your ERP system can quickly become a liability rather than an asset.

That’s why we’ve put together the ultimate ERP security checklist—a comprehensive guide to what businesses should be reviewing at least once a year (and preferably more often). Follow these steps to keep your system secure, your data protected, and your business compliant.

1. User Access and Role-Based Permissions Review

Why It Matters:

Excessive permissions are one of the biggest security risks in ERP systems. Employees accumulate access over time, often keeping permissions they no longer need. This increases the risk of insider threats and unauthorized access.

What to Audit:

✅ Review all user accounts: Identify inactive accounts and remove them immediately. ✅ Check for “privilege creep”: Ensure employees only have permissions relevant to their current role. ✅ Verify role-based access control (RBAC) policies: Ensure roles align with least-privilege principles. ✅ Monitor high-risk users: Pay extra attention to admin accounts, financial officers, and IT staff. ✅ Use a solution like NoirSoft D365RoleSecure to enforce Segregation of Privileges (SoP) and prevent over-permissioning.

2. Authentication and Multi-Factor Security Measures

Why It Matters:

Weak passwords and single-factor authentication are a hacker’s dream. Multi-factor authentication (MFA) significantly reduces the risk of unauthorized access.

What to Audit:

✅ Ensure MFA is enabled for all users, especially admins. ✅ Check password policies: Are employees using strong, unique passwords? ✅ Monitor login activity for suspicious behavior. ✅ Evaluate Single Sign-On (SSO) security.

3. Compliance and Regulatory Requirements

Why It Matters:

Failing to comply with industry regulations can result in legal penalties, data breaches, and loss of customer trust.

What to Audit:

✅ Ensure ERP security policies align with regulations like GDPR, SOX, and HIPAA. ✅ Verify data encryption policies. ✅ Run regular compliance audits and document findings. ✅ Ensure that access control aligns with regulatory best practices.

4. Security Patch and System Update Checks

Why It Matters:

Outdated software is a hacker’s easiest entry point. Many cyberattacks exploit unpatched vulnerabilities.

What to Audit:

✅ Ensure ERP software and plugins are running the latest security patches. ✅ Review vendor security advisories for new vulnerabilities. ✅ Check firewall and endpoint protection policies.

5. Data Backup and Disaster Recovery Planning

Why It Matters:

If ransomware or a system failure occurs, can your business recover quickly?

What to Audit:

✅ Verify that ERP data is backed up regularly. ✅ Test the restoration process to ensure backups work. ✅ Check backup security to prevent unauthorized access. ✅ Review disaster recovery procedures.

6. Audit Logs and Real-Time Monitoring

Why It Matters:

Attackers often operate unnoticed for weeks before launching an attack. Real-time monitoring can stop threats before they escalate.

What to Audit:

✅ Ensure audit logs track all user activity. ✅ Review logs for suspicious access patterns. ✅ Use AI-driven security monitoring tools for anomaly detection. ✅ Set up alerts for unauthorized access attempts.

7. Third-Party Integrations and API Security

Why It Matters:

ERP systems often integrate with third-party applications, expanding functionality but also increasing risk.

What to Audit:

✅ Review all third-party integrations for security compliance. ✅ Ensure APIs are encrypted and follow security best practices. ✅ Limit third-party access to essential data only.

8. Employee Training and Security Awareness

Why It Matters:

Even the best security system fails if employees don’t follow security best practices.

What to Audit:

✅ Ensure employees are trained on phishing and social engineering threats. ✅ Conduct regular security awareness sessions. ✅ Test employees with simulated phishing attacks.

Conclusion: ERP Security Is a Continuous Process

Securing your ERP system isn’t a one-time effort—it requires constant vigilance. By following this annual security audit checklist, businesses can significantly reduce their risk exposure and stay ahead of potential threats.

Solutions like NoirSoft D365RoleSecure can further enhance security by automating Segregation of Privileges (SoP) and enforcing strict access control policies.

When was the last time your ERP system underwent a security audit? If it’s been a while, now’s the time to act.