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Published on: September 04, 2007
Type of content: WHITE PAPER
Format: Adobe Acrobat (.pdf) (145 kb)
Length: 16 pages
Price: FREE

Overview:
With the passage of the Sarbanes-Oxley Act in 2002, publicly traded companies in the U.S. must exercise higher levels of oversight over corporate information and the processes used to link this information to financial accounting statements.

New rules promulgated by the European Union, drafted in response to corporate accounting fraud similar to the scandals that roiled the U.S. economy, compound the challenge for multinational businesses.

Virtually all publicly traded companies are affected by one or more of these regulations. The suddenness with which many of these new regulations were enacted has left many businesses scrambling to understand their impact on internal processes. In the United States, most affected businesses have focused on the most striking – and loosely drawn – provisions of the SOX Act.

As noted, Section 404 of Sarbanes-Oxley has commanded the most attention from companies and their auditors, since it has the most wide-reaching implications for the establishment of key internal financial controls. Achieving this level of financial control is dependent to a great extent on the control characteristics of the underlying computer and other IT systems that support financial reporting systems.