Sarbanes-Oxley Act: SOX

• Became Law on July 30th, 2002
• Oversight by Securities & Exchange Commission
• Created a Public Company Accounting and Oversight Board
• Most comprehensive corporate anti-crime law in history
• HIPAA and GLB are privacy acts.
• Sarbanes Oxley is a corporate governance act.
• Separated accounting functions into: Consulting - Audit
• Audit now has more power & authority
• Must change audit teams every 5 years
• It's no longer just the numbers a company reports
• It's how it got those numbers
• If a policy is not in writing it does not exist
• If an action is undocumented it did not happen
• Company CEO, CFO & CIO must certify to the completeness and accuracy of financial reporting
• Consequences: Costly remediation - Loss of stockholder confidence - Stockholder lawsuits - Criminal penalties
• The Consequences tend to get your attention
• The entire process of ensuring compliance is so massive and so complex that it can only be achieved by automation
• SOX only specifies what a well run company should already be doing
• The high cost of compliance is offset by operational efficiencies that will result in a competitive advantage

Click on the link to download the SOX Flyer.