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SOX
Sarbanes-Oxley, or SOX, or sometimes called Sarbox, established new and enhanced accounting and reporting standards for public U.S. companies. This has led to many new reporting and auditing requirements for application development teams that make software that involve company revenue generation, reporting, customer information and accounting.
History The Sarbanes-Oxley Act of 2002 was passed in response to several major corporation's accounting scandals, such as Enron, Tyco International and WorldCom and the Dot com bust. These scandals were eroding the public trust of corporate accounting and creating a stock market nightmare for investors. The government wanted to quell this rising tide of no-confidence by overwhelming approving the Sarbanes-Oxley Act.
SOX-Section 404 Assessment of Internal Control requires companies to prove they have control and accuracy of their financial reporting. Section 404 requires each public company to include in their annual report the following list.
Auditor's Attestation There are two Auditor objectives in the SOX-Audit.
Passing the Audits Proving that companies have internal controls in place that protect customer information and accurate report financial information are at the heart of the audits. Development teams that have sound software development process and follow SCM best practices have found that most of these reporting and auditing processes and procedures to already be in place. It is just a matter of running reports and documenting the audit trail However, some organization's development teams that have little to no processes in place have found these new reporting and auditing requirements to be quite invasive and painful to meet. Not only are they struggling with providing audit reports, they are having to create processes that support the accuracy of these reports. For many organizations, this is no small feat.
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August 2008
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