Sarbanes-Oxley is the buzzword today....more and more enterprises are keen to be in compliance with this Act. In simple words SOX is all about definition, documentation, implementation and assessment of effective internal controls. Its also about prompt reporting of material events, which may effect the financial performance of the firm.
Compliance to this Act has lead organizations to streamline their Governance process. Section 404 of SOX promotes good organizational governance procedures. Section 302 needs the CEO and CFO to disclose whether there were any significant changes in the firm's internal controls within 90 days of the financial reporting filings.
So how does it all help and organization:
1. It helps educate employees
2. Helps to monitor and audit policy compliance
3. It changes the behaviour of trusted employees to prevent accidental disclosures
4. It helps identity and fix poor business processes that unnecessarily expose to sensitive data,
5. It prevents costly and embarrassing compliance incidents.
Have a good day.
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