Are there holes in your SOX? (Sarbanes-Oxley compliance for public and private companies)
Website design By BotEap.comResume:
Website design By BotEap.comEnron’s illicit transgressions and others like them in the late 1990s led to the creation of regulations to standardize the reliability of financial institutions and public companies. Companies facing SOX compliance will need to consider the following: What are best practice processes, how are these processes different from existing practices, how new processes should be implemented, and how can short-term processes be balanced with “longer term strategic goals”?
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Website design By BotEap.comA world before SOX:
Website design By BotEap.comThe corporate world had a rude awakening after a series of highly publicized corporate financial scandals. Many stories of embezzled corporate dollars emerged in the late 1990s involving companies like Enron, Tyco, and WorldCom. The legislation soon responded to the multitude of serious transgressions committed by the top management of the business world.
Website design By BotEap.comThe offenses committed by these industry bosses ranged from extravagant multi-million dollar trips to exotic locals, large private gifts to spouses, and shuffling company funds to fund other investments. The corporate world needed to be held accountable for its misdeeds. SOX (Sarbanes-Oxley Act) or the Public Companies Accounting Reform and Investor Protection Act of 2002 came into being to improve corporate governance and help control possible future misdeeds.
Website design By BotEap.comThe Sarbanes-Oxley Act of 2002 requires publicly traded entities to define, evaluate, and document the processes that lead to senior management accountability. SOX requires that substantial verification checks or audits be put in place to ensure that top management is at fault for its financial actions.
Website design By BotEap.comWhy should private companies care about SOX?
Website design By BotEap.comWhile SOX applies directly to publicly traded companies, private companies wishing to do business with companies listed on places like the NASDQ must also comply with Sarbanes-Oxley.
Website design By BotEap.comMany large public corporations will simply refuse to do business with private companies that do not comply with SOX. Private companies that want to do business with large public entities are now also involved in a SOX-compliant landscape.
Website design By BotEap.comSOX affects a wide range of industries that “touch” information from publicly traded companies, including and not limited to:
http://news.bbc.co.uk/2/hi/technology/4809262.stm Website design By BotEap.com3.) Joris Evers, “Newsmaker: Locking down America’s Net defenses” February 16, 2006, CNet New.com – [http://news.com.com/Locking+down+Americas+Net+defenses+-+page+2/2008-7348_3-6040223-2.html?tag=st.num]
- Lawyers
- Accountants and audit firms that review the financial statements of the company.
- Brokers or distributors and their employees
- Security companies that handle electronic transactions
- International companies operating in the United States
- SOX Section 404: Spreadsheets and financial reports must be protected against accidental or deliberate falsification or redistribution.
- SOX Section 409: Real-time disclosure of material affecting company finances must be reported within 48 hours.
- SOX Section 802: Ensures that documents and records are not tampered with
- SOX Section 1102: Corrupting, tampering, mutilating, destroying or concealing records are violations. Those guilty of obstructing an investigation or official proceeding will face 20 years in prison and fines.
Website design By BotEap.com“Small and large businesses and government are important when it comes to reducing cyber risk. We are trying to educate partners on responsibility and the techniques that consumers can use to help protect their systems …”(3)Website design By BotEap.comBefore Sarbanes-Oxley, corporations saw serious abuse of executive power at the cost of serious business growth. Today, severe criminal and civil penalties will be imposed for violations of securities law against companies that do not meet SOX standards. Website design By BotEap.comHow can private companies thrive in today’s realm of email connection, while still being SOX compliant? Introducing strong compliance policies in line with SOX, including firewalls, up-to-date virus protection, encryption, and email anti-theft measures, can help a company work cooperatively with publicly traded companies. Website design By BotEap.comBenefits of email anti-theft software Website design By BotEap.comImplementing email theft protection enables a business to grow in credibility, reputation, and trust; all factors that lead to an increase in clientele and income. Website design By BotEap.comWith security measures to maintain business correspondence and protect outgoing email, SMBs can be prudent with their technology budgets and well-armed with the tools and resources necessary to comply with the industry. Customers will feel more secure sharing their personal information with compatible SBM offices, paving the way for better and more secure communication. Website design By BotEap.com– – – – – – – – – – – Website design By BotEap.comFinal notes: Website design By BotEap.com1.) Rob Preston Information Week “Time to Regulate Regulations,” Feb. 27, 2006, pg. 78. Website design By BotEap.com2.) BBC News, “Business Lax in Safeguards Against Identity Theft” March 16, 2006, BBC Online; URL:
http://news.bbc.co.uk/2/hi/technology/4809262.stm Website design By BotEap.com3.) Joris Evers, “Newsmaker: Locking down America’s Net defenses” February 16, 2006, CNet New.com – [http://news.com.com/Locking+down+Americas+Net+defenses+-+page+2/2008-7348_3-6040223-2.html?tag=st.num]