Compliance Sarbanes Oxley

Many companies feel that Sarbox requires a holistic look at business and IT infrastructure, starting with financial processes and reaching back to the operational processes that promote them. Any investments made towards Sarbox compliance should also improve the business and provide a return on investment (ROI). Fortunately, many of the companies who have already implemented new processes and procedures to ensure compliance now have the opportunity to improve upon their original efforts by using identity management to automate many of those processes. This paper discusses how identity management technology is ideally suited to automating processes that enable Sarbox compliance.

How has Sarbanes-Oxley impacted corporate governance/ In your opinion, which provision of Sarbanes-Oxley is most difficult for organizations to implement?

No idea jargon to me

What business events was this Act in response to by Congress? Do you think this will help or hurt the business environment?

First of all – who is impacted by SOX (Sarbanes-Oxley Act)? Any company that is publicly held – a company that has shares to buy on any American Stock Exchange. If you are a sole proprietor, a partnership, an LLC, you don’t need to legally comply – but many of the ideas behind the Act are just good business practices. Any foreign-based company that sells on the any American Stock Exchange also has to follow the SOX act, though they had a little more time to get their testing in place.

After the Enron, World Com, Arthur Andersen messes, etc., the government stepped in to protect the investors – and especially protect the employee’s pension funds. They didn’t want to see a group like the out-of-work Enron employees that didn’t even have a pension left.

So – in their wisdom, they came up with the SOX Act. What is required by this act is a series of self-tests that make sure that all the ‘I’s are dotted and the "T’s crossed in a legal way that follows the GAAP (Generally Accepted Accounting Procedures) rules.

This set of tests has to be submitted to the SEC (Security and Exchange Commission), approved, and religiously followed. Companies are subject to audit of their SOX testing and compliance. I am not sure what the fines and penalties are that are assessed – and the company I work for set out to not find this out. We have numerous tests, we self-audit on a monthly basis, and so far we have kept the SEC happy. If you are a publicly-traded company, it would be totally stupid to disregard this ACT.

What accounting issues does the Sarbanes-Oxley Act of 2002 address? How do the act’s provisions change the behavior of senior corporate executives and accounting professionals? Do you think this is an effective solution or will it create additional paperwork?

The passage of the Sarbanes-Oxley Act and actions by the U. S. Securities and Exchange Commission imposed new requirements on auditors, corporate boards and management. The Board must adopt an audit standard to implement the internal control review required by section 404(b). This standard must require the auditor evaluate whether the internal control structure and procedures include records that accurately and fairly reflect the transactions of the issuer, provide reasonable assurance that the transactions are recorded in a manner that will permit the preparation of financial statements in accordance with GAAP, and a description of any material weaknesses in the internal controls.

The Act’s provisions ensures that senior corporate executives and accounting professionals are kept on their toes as they have to make periodic certifications that:
• The signing officers have reviewed the report
• The report does not contain any material untrue statements or material omission or be considered misleading
• The financial statements and related information fairly present the financial condition and the results in all material respects
• The signing officers are responsible for internal controls and have evaluated these internal controls within the previous ninety days and have reported on their findings
• A list of all deficiencies in the internal controls and information on any fraud that involves employees who are involved with internal activities
• Any significant changes in internal controls or related factors that could have a negative impact on the internal controls

It will require more documentation and certainly incur a lot of cost.

Can anyone give examples?

for public companies it has added significant burden to ensure the many key areas of controls are compliant. for the audit industry it has been a huge revenue stream

What are the benefits of more regulation to internal control of companies? Is there a cost-benefit relationship ? Thanks

Well, for one thing, it prohibits the payor from adjusting the invoice. Check out the Tom Coughlin case, the SOX act would have kept him from stealing millions from Wal-Mart.

Sarbanes-Oxley Act. Pub. L. 107-204. 116 Stat. 745-???. July 30, 2002. Print. (or Web. as the case may be for you).

I used the rule on the MLA Style Manual page 233 for Acts, and Wikipedia for the act info, which you might be able to verify this information as you have actually viewed the act and I have not.

In text, cite it using the title of the act, but see Wiki for alternative names it apparently has. You should use the abbreviated name, SOX, if you are writing for a legal audience; if it is not for a legal audience then use the full name. And MLA stipulates – Do not italicise act titles or enclose them in quotation marks in text or in Works Cited. So in or out of parentheses, it’s just Sarbanes-Oxley Act, or the short form if appropriate. Refer to the section number rather than page, eg. (SOX. Sec. 10).

Best,
RH

www.referencinghelp.info

1: Smaller public corporations can’t afford the heavier accounting burden, so they get taken private and become LESS accountable than they were prior to sarbanes oxley.

2: Companies that can’t report accurately dont report ontime, and the public has LESS info than they did about they companies than before.

3: Honest companies get burdened with excessive accounting costs, and their share holders get no benefit from the accounting rules because the company was honest anyway.

4: It creates an over demand in the job market for accountants so companies that need to fill other positions have a harder time filling them.

5: Makes US companies less competitive with foreign competitors.

6: Has spawned a wave of mergers, so that their are now fewer small corporations and more big ones.

7: Has delayed initial public offerings because companies know they have a higher burden on their accounting from the beginning.

8: Has made it harder for Fannie Mae to do business so in turn has hurt the mortgage market.

9: Has made it harder for the top CEO’s to be paid what they are actually worth.

Crawback provision of Sarbanes-Oxley Act allowed SEC to collect $600 millions from ex-CEO of United Health. Why can’t taxpayer (US govt) collect billions from ex-CEO/CFO of AIG, Fannie Mae, Freddie Mac? It’s obvious that their golden porachute was beyond extreme.

I think they should charge them under the RICO act of 1970.

Chategorize them if you can.

Consulting Firms.