Financial Compliance through Section 404 of the Sarbanes-Oxley Act

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Section 404 of the Sarbanes-Oxley Act is perhaps the most litigious portion of the SOX compliance law with a focus on financial compliance. The section obligates an organizational management and peripheral auditors to submit reports on monetary reporting along with domestic control.

This section of the law is labeled as “Assessment of Internal Control”. Being a rather expensive process, it forces businesses to execute the law by filing and examining pecuniary manual and mechanized controls.

According to Section 404 of the Sarbanes-Oxley Act, organizations and businesses are entitled a chance to evaluate their assets, transactions and company performance every year. The final reports are submitted to federal authorities for checking.

Key Aspects

Basically, the SOX compliance obliges an administration to

The SOX compliance features tax costs that are based on a company’s inefficiency to perform. Thus, these rules tend to encourage an administration to work harder and produce better results in the future. This eventually leads to a prosperous economy.

Further reading: Corporate Governance | Audit | Performance Improvement

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