Sarbanes Oxley : How It Impacts Companies On Accounting Software Decisions

2491 WordsNov 30, 201410 Pages
Collin Skodinski & Jeffrey Whitmer Prof. Pathak Final Project November 24, 2014 Sarbanes-Oxley: How it Impacts Companies on Accounting Software Decisions What do you think of when you hear these three names: Enron, Tyco, and Worldcom? Most people nowadays would say that they think of massive corporate corruption, accounting and investor fraud, corporate collapse, and extensive trials and jail time for corporate officials. At the dawn of the new millennium, the leaders of these three corporations, along with dozens of others, committed massive financial fraud against their investors, employees, and the rest of their stakeholders. In response to these incidents and to help answer the public’s outcry for justice, the United States Congress…show more content…
All of these packages provide a wide range of different features and options that a business should take into account before making a decision on which package to use, but the most important is that it makes the organization SOX complaint. This report will go over the Sarbanes-Oxley Act of 2002 as wells as compare and contrast various software packages to determine which ones will make an organization the most compliant with SOX. The Sarbanes-Oxley Act of 2002 in the most general terms is a law passed by the United States Congress to help stop publicly traded corporations and their leaders from committing accounting and financial fraud. The act is made up of various sections but we will go into detail only about a few of them including Section 302, Section 404, Section 409, and section 802 which deal directly with IT (Brown, 2005, 313). Section 302 deals directly with the officers of a company and requires them to “make representations related to the disclosure of internals controls, procedures, and assurance from fraud (Brown, 2005, 313).” In other words, companies will be required to have their CEOs and CFOs sign off on all publicly made financial statements. Also, in a recent survey “44 percent of the companies will require the CIO to certify financial results under SOX compliance (Brown, 2005, 313).” This certification will include the CIO signing a statement attesting to the accuracy of the financial statements as well as the effectiveness of
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