SOX Compliance Summary

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First Year of SOX Compliance: Success Fifteen plus years ago public corporations were being scrutinized due to numerous accounts of dishonesty, fraud, collusion, and lack of accountability to their investors. The cries of investors were heard and answered by the creation of the Sarbanes-Oxley Act of 2002 (SOX). “SOX became law on July 30, 2002, the Securities and Exchange Commission (SEC) enforces it, and the Public Company Accounting Oversight Board (PCAOB) oversees the accounting industry” (Balance, 2016). The tide was turning, and the new blubbers stemmed from the corporations themselves on how they would appropriate the money, workforce and time to ensure that all the SOX mandates were in place by December 31, 2004. One company that stood …show more content…

Trinity’s first goal was to “prioritize the already started significant changes to its reporting methods by combining all business units (BU) financial information into one standardized process which involved combining four general ledger packages currently in place to one with Oracle Financials.” Oracle would “allow for timely closing of the books and the availability of the financials.” Consequently, this forward thinking company’s “planning to improve reporting effectiveness before SOX managed to save them $.5 million annually”. Additionally, Trinity “developed an Accounting Service Center (ASC) which was to be run by an independent service. Furthermore, this entity would provide centralized outsourced transaction administering for billing, accounts payables and payroll …show more content…

“The purpose and development of internal controls for a company are to communicate through documentation to external entities how they are proactively monitoring for any possible deficiencies that might arise and the systems that are in place to hinder those possible defects.” “The goal when developing internal control procedures was to first put into place as many safety controls to first prevent a weakness from establishing and testing them to rule out any gray areas that might lead to a misstatement and correct them immediately” (Layperson, 2006). Trinity spent the better part of a year doing just that by “first defining the project as a whole, second planning the project by deciding what tools would be required breaking down staff into specific teams and mapping out the train. The third was the actual documentation phase that was accomplished by a bottom-up approach to the organization’s work practice. The fourth was to identify the gaps in controls i.e. comparing the company’s current controls to the SOX required controls”. The fifth and sixth steps were to evaluate and tweak any of the control design that wasn’t meeting expectations. The systems that were now in place required

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