You are on page 1of 4

Kevin Vilbig - Sarbanes-Oxley This is a new exploration for me.

The law was spoken against in some circles after it was passed. I ran into the words Repeal Sarbanes-Oxley1 ! regularly in scanning political conversations online. I didnt think much of it because it was a fringe issue. It explains the kind of controls and responsibilities financial organizations have to abide SOX is a financial reporting law. (96) It was passed in 2002 in response to corporate financial fraudsters, like Enron. (567) SOX has had a major impact on the accounting, recordkeeping, and controls landscape for all publically traded corporations doing business and/or being rraded in the United States. (567) There are a number of legal requirements that SOX put into effect relating to financial reporting and IT accountability regarding the financial profession. SOX requires records retention and IT audit controls. (567-8) SOX requires systems and system changes be thorougly documented so there is transparency and controls in place that will allow exectives to sign financial statements and stay out of jail! (354) SOX necessitates audits. (358) The Committee of Sponsoring Organizations2 ... created a framework for auditors to assess controls. (568) They assigned five criteria as their focus: Risk Assessment Control Environment Control Activities Monitoring Information and Communication This URL will take you to their homepage:
1 Hereafter referred to as SOX 2 COSO

The Committee of Sponsoring Organizations (COSO) mission is to provide thought leadership through the development of comprehensive frameworks and guidance on enterprise risk management, internal control and fraud deterrence designed to improve organizational performance and governance and to reduce the extent of fraud in organizations. COSO Website - About Us

They are made up of five different financial professional organizations, their board is comprised of a representative of each. (COSO Website The organizations are the American Accounting Association, the American Institute of CPAs, Financial Executives International, The Association of Accountants and Financial Professionals in Business, and The Institute of Internal Auditors. (COSO Website board.htm) SOX is succicntly defined in the text on pages 567 and 568 and the text is available at the following URL via the Government Publishing Office. The HTML is 4173 lines long. Which because of the doctype is about what it would be plainttext. It contains almost thirty-thousand words. Now here is a rundown of the titles from the Sarbanes Oxley act copy-pasted from the GPO URL previously provided:


TITLE VI--COMMISSION RESOURCES AND AUTHORITY TITLE VII--STUDIES AND REPORTS TITLE VIII--CORPORATE AND CRIMINAL FRAUD ACCOUNTABILITY TITLE IX--WHITE-COLLAR CRIME PENALTY ENHANCEMENTS TITLE X--CORPORATE TAX RETURNS TITLE XI--CORPORATE FRAUD AND ACCOUNTABILITY This overview via the TITLES of the law. shows the creation of a bureaucratic body in order to enforce the controls that our Democracy felt was needed in the wake of the financial scandals that were exposed right after the turn of the century.

References I would like to thank the Wikipedia Foundation as the first stop on this tour. They have consistently proven that human beings value information enough to share it with everyone on the virtue of donations. I would also like to thank Pearson Education for the textbook for the course. It was instrumental in the creation of this report. I would like to thank the Government Publications Offices great work in keeping the virtual lights on in the midst of this shutdown. And last, but certainly not least, we have the COSO board who helped to craft this legislation!