Sarbanes-Oxley Act - Section 404 Compliance And Review Assessment
Location
CSU 255
Start Date
25-4-2006 8:45 AM
End Date
25-4-2006 10:15 AM
Student's Major
Accounting and Business Law
Student's College
Business
Mentor's Name
Mary Rolfes
Mentor's Department
Accounting and Business Law
Mentor's College
Business
Description
The Sarbanes Oxley Act of 2002, enacted after the Enron and WorldCom scandals, is quite easily the most influential legislation that has been passed for the business world. Section 404 of this Act requires managers, internal auditors and external auditors to account for the effectiveness of internal controls as a part of each Annual Exchange Report which is a part of the Financial Report. Close to four years have passed since this Act has been enacted and deadlines for companies to comply with this Act have passed. At this point, professionals who deal with ensuring observance are well versed with what is expected and how it is to be done. However, many difficulties were faced initially and costs of compliance were high. Although, the objective of this Act was to strengthen the reliability of fmancials and reduce opportunity for fraud, it is a complex Act and compliance has proven to be difficult. One wonders how effective the Act has been in achieving its objective. Are the costs of conformity still heavier than the benefits? Is this Act something that professional accountants and managers would want to live with? The purpose of this research will be to find an answer to these questions with the help of primary and secondary research. Primary research will be conducted via questionnaires sent to accounting firms and accounting departments of companies and secondary research will consist mainly of reviews from professionals who are impacted by Sarbanes Oxley.
Sarbanes-Oxley Act - Section 404 Compliance And Review Assessment
CSU 255
The Sarbanes Oxley Act of 2002, enacted after the Enron and WorldCom scandals, is quite easily the most influential legislation that has been passed for the business world. Section 404 of this Act requires managers, internal auditors and external auditors to account for the effectiveness of internal controls as a part of each Annual Exchange Report which is a part of the Financial Report. Close to four years have passed since this Act has been enacted and deadlines for companies to comply with this Act have passed. At this point, professionals who deal with ensuring observance are well versed with what is expected and how it is to be done. However, many difficulties were faced initially and costs of compliance were high. Although, the objective of this Act was to strengthen the reliability of fmancials and reduce opportunity for fraud, it is a complex Act and compliance has proven to be difficult. One wonders how effective the Act has been in achieving its objective. Are the costs of conformity still heavier than the benefits? Is this Act something that professional accountants and managers would want to live with? The purpose of this research will be to find an answer to these questions with the help of primary and secondary research. Primary research will be conducted via questionnaires sent to accounting firms and accounting departments of companies and secondary research will consist mainly of reviews from professionals who are impacted by Sarbanes Oxley.
Recommended Citation
Sumar, Nida. "Sarbanes-Oxley Act - Section 404 Compliance And Review Assessment." Undergraduate Research Symposium, Mankato, MN, April 25, 2006.
https://cornerstone.lib.mnsu.edu/urs/2006/oral-session-K/5
