Inventory _and_amp; SOX 136



  • Even if client were a supplier, SOX would not require financial documentation from the supplier. Only vendors whose services have an impact on the financial reporting of a company are specifically covered by SOX.



  • What COULD be happening is that CompanyA has a control gap in their credit process, and either they or their externals have decided that getting financials from all companies is the way to close that gap.
    A faulty credit process would certainly qualify as an issue under SOX, and I could see this as a one-size-fits-all solution.
    I’d still tell them no, if I were your client.
    Ben



  • What COULD be happening is that CompanyA has a control gap in their credit process, and either they or their externals have decided that getting financials from all companies is the way to close that gap.
    Ben
    Although management of credit control is not a financial statements issue - rather it is a business/operational issue. Provided that a company adequately provisions its bad debt it doesn’t really matter how bad their credit control is 😮



  • It could also be part of a FIN46 analysis…???


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