SOX Definition 1637

  • Hi All,
    I am looking for a definition for SOX for a SLA with one of our customers.
    I gave them this:
    ‘SOX Sarbanes-Oxley is a US law passed in 2002 to strengthen Corporate governance and restore investor confidence. Act was sponsored by US Senator Paul Sarbanes and US Representative Michael Oxley. Sarbanes-Oxley law passed in response to a number of major corporate and accounting scandals involving prominent companies in the United States. These scandals resulted in a loss of public trust in accounting and reporting practices. Establishes new standards for Corporate Boards and Audit Committees Establishes new accountability standards and criminal penalties for Corporate Management Establishes new independence standards for External Auditors.’
    They were not happy with it because it doesn’t define what SOX is but rather why it came into being.
    I am looking for something along the lines of ‘SOX is an international compliance standard which etc’
    Can anyone help me

  • SOX is not an international compliance standard it is a US Act.
    Anyway, Wikipedia gives this as an introduction:
    'The Sarbanes-Oxley Act of 2002 (Pub. L. No. 107-204, 116 Stat. 745, also known as the Public Company Accounting Reform and Investor Protection Act of 2002 and commonly called SOX or SarbOx; July 30, 2002) is a United States federal law passed in response to a number of major corporate and accounting scandals involving prominent companies in the United States. These scandals resulted in a decline of public trust in accounting and reporting practices. The legislation is wide ranging and establishes new or enhanced standards for all US public company Boards, Management, and public accounting firms. The Act contains 11 titles, or sections, ranging from additional Corporate Board responsibilities to criminal penalties, and requires the Securities and Exchange Commission (SEC) to implement rulings on requirements to comply with the new law. ’
    Which seems as good as anything else I’ve seen.

  • Hi - Below are a few more definitions related more to what SOX is about rather than why it was implemented.
    DEFINITION: Sarbanes-Oxley: (Sarbanes-OXley Act) Administered by the Securities and Exchange Commission (SEC) in 2002, SOX regulates corporate financial records and provides penalties for their abuse. It defines the type of records that must be recorded and for how long. It also deals with falsification of data. Affecting data storage capacities and planning, SOX was enacted after the Enron and WorldCom scandals of the early 2000s. The bill was sponsored by Paul Sarbanes, Democratic Senator from Maryland and additionally authored before passage by Michael Oxley, Republican Senator from Ohio.
    The Sarbanes-Oxley Act of 2002 (often shortened to SOX) is legislation enacted in response to the high-profile Enron and WorldCom financial scandals to protect shareholders and the general public from accounting errors and fraudulent practices in the enterprise. The act is administered by the Securities and Exchange Commission (SEC), which sets deadlines for compliance and publishes rules on requirements. Sarbanes-Oxley is not a set of business practices and does not specify how a business should store records; rather, it defines which records are to be stored and for how long. The legislation not only affects the financial side of corporations, but also affects the IT departments whose job it is to store a corporation’s electronic records. The Sarbanes-Oxley Act states that all business records, including electronic records and electronic messages, must be saved for ‘not less than five years.’ The consequences for non-compliance are fines, imprisonment, or both. IT departments are increasingly faced with the challenge of creating and maintaining a corporate records archive in a cost-effective fashion that satisfies the requirements put forth by the legislation.
    The Sarbanes-Oxley Act was signed into law on 30 July 2002 by President Bush. The Act is designed to oversee the financial reporting landscape for finance professionals. Its purpose is to review legislative audit requirements and to protect investors by improving the accuracy and reliability of corporate disclosures. The act covers issues such as establishing a public company accounting oversight board, auditor independence, corporate responsibility and enhanced financial disclosure. It also significantly tightens accountability standards for directors and officers, auditors, securities analysts and legal counsel. The law is named after Senator Paul Sarbanes and Representative Michael G. Oxley
    I’ll even share my own simplified definition below 😉
    Sarbanes-Oxley = SEC based regulations that provide enhanced financial and IT controls, which are standard requirements for all publicly listed companies in the United States based on qualifying business volumes.

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